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BBC 2017: Which of these 14 options is best to collect 4 billion quid a year?

There are loads of options for BBC funding, if you think about it. I have come up with ten criteria and fourteen funding systems. Which one comes out on top?

How can the BBC be funded from 2017?  How???   Photograph: Shutterstock
How can the BBC be funded from 2017? How??? Photograph: Shutterstock
published on UK Free TV

In the first part of this analysis, I am providing a decision grid to look at the possible funding methods for the BBC.



The scoring criteria are described below. I will return to each method in detail in the coming days.

As ever, I would love to know what you think!

How simple is the system to administer?

The score here relates to if the system proposed is easier or harder to provide than the one used by TV Licensing at the moment.

What is the total cost overhead?

A high score indicates that the money raised will go to programmes, rather than administration. A low values suggests higher admin costs than the TV Licence.

How stable and predicable is the income from the system?

This relates to how reliable the income stream will be. The TV Licence is based on the number of UK households, a value that changes little. The score for this section relates to the predictability of income.

How many people pay something towards the system?

The current system has one payment per household. A higher score indicates the burden is shared out more evenly, a low value if it places a burden on fewer people.

How many people get to use the service?

The current system provides service to everyone who has a TV or a radio. The score here is lower if less people will be using the BBC.

How does the system increase the independence of the BBC from the state?

The TV Licence has some distance between the state that authorizes the collection of the fee and the use by the BBC to make programmes. A low score is given to systems where politicians could hold sway over the BBC.

How does the amount each person pays relate to their wealth?

The current system is based around households, not the wealth of the payer. The score here is higher when richer people contribute more and poorer people less.

How easy is it for the public to understand how they pay for the BBC?

The TV Licence system provides a reasonable linkage between payer and service. A high score here relates to the system proposed providing a more comprehensible link between payment and provision.

How do people opt out of the system if they don't wish to take part?

You can opt out of paying for the BBC is you select to not have a TV. The score here is low if the proposed system has no opt-out for those who oppose the service.

What happens to people who don not pay?

The current system has the backing of criminal sanction. The score here relates to the change in the officiousness of the non-payment punishment.

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In this section
BBC salami-slicing returns to overnight services?1
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Goodbye BBC Red Button!3
Want to know how much the BBC spend in England, Scotland, Wales and NI per home?4
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BBC future: make sure you make the deadline6

Comments
Thursday, 27 March 2014
T
trevorjharris
sentiment_satisfiedGold

10:30 AM

There is one guiding principle that the BBC should be paid for by the people who use it's services. You seem to have left out advertizing and voluntary contributions.

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trevorjharris's 367 posts GB flag
Briantist
sentiment_very_satisfiedOwner

11:01 AM

trevorjharris: no. There are clearly 10 principles in my list.

I left out advertising as I've covered that elsewhere.

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Briantist's 38,910 posts GB flag
C
Charles Stuart
sentiment_satisfiedSilver

12:51 PM
Bristol

While I favour retaining the licence fee, with the addition of my suggestion that iPlayer should be pay-per-view, I think that a tax on subscription television could be used to pay for the non-BBC bits that the licence fee currently covers, with any left over being used to reduce or freeze the price of the licence. I would be against any other tax, except possibly on the sale of new televisions and television-related equipment, which I could see providing a small additional income that could reduce the licence fee by maybe £10pa.

I am totally against the BBC being funded by commercials, even in part, though I wouldn't object to the BBC being a shareholder in commercial channels (which I think it already is) or operating specialist subscription channels.

The only other funding model that has some attraction to me is general taxation but that raises the ugly spectre of government interference in the independence of the BBC.

I'd stop paying my council tax in protest if the BBC was funded that way! Council tax, in my opinion, should be abolished and councils almost entirely funded by block grant. And I disagree with your rating of 7 for whether it relates to the payer's wealth. I'd be inclined to give it 2 or 3, though I can see that you give it 7 because there's a microscopic correlation between a person's wealth and how much council tax they pay and the licence is a flat fee. Council tax is an iniquitous tax that penalizes badly those just a little above the bottom.

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Charles Stuart's 159 posts GB flag
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Briantist
sentiment_very_satisfiedOwner

1:10 PM

Charles Stuart: If defense of giving the Council Tax a "7" score for Tax Progressiveness it gets that score because it is better than the current per-household fee, which makes no account whatsoever of the household's wealth.

Thus "Band A" might pay £6 a month, "Band D" £12 and "Band H" say £24 a month, with an inbetween scale.

It's not a perfect indication of the wealth of the household (that would get a "9") but it is better than a "poll tax" (where every person pays the same, regardless) which would have got a low score.

The scale I have used is "5"=current system.

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Briantist's 38,910 posts GB flag
K
KMJ,Derby
sentiment_satisfiedGold

4:37 PM

Briantist: This country could adopt the German funding model, where a flat charge is made to every household whether there is TV usage or not. This could simply replace the TV licence, or could be a smaller charge set to fund those services not considered viable in a commercial context, but considered to be socially and /or politically desirable. This would include Radio3, Radio4, BBC local radio, national radio for Wales, Ulster and Scotland, S4C,BBC Parliament, plus support for local TV and rural broadband. In the event that regional news is dropped by the BBC, depending on whether the Conservatives are in power, we could even see further licences advertised for local TV stations to cover most large population centres. I don't see why the income level of the household is relevant, Sky subscriptions are not currently cheaper for low income families! Regarding BBC1 and 2 being subscription services, therefore needing to be encrypted, it is possible that technology would have reached the stage where DVB-T2 was due to be replaced by a more efficient mode. It would be interesting too, to consider what would happen if most TV services were subscription, with only ITV, Channel 4 and Channel 5 being free to air on satellite and DTT, plus local TV on DTT.

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KMJ,Derby's 1,811 posts GB flag
T
trevorjharris
sentiment_satisfiedGold

5:49 PM

Actually this system of scoring is ridiculous. The choice of scoring criteria is arbitary and the same weight is given to each criteria. This expains why the mobile phone surcharge comes out top. I assume this is a surcharge on the mobile phone usage. So why should people be taxed in this way . It is a mad way to fund the BBC.

The only practical way to fund the BBC is advertizing, subscription and business ventures.

As I have said the BBC does not deserve to be funded by tax. There is little to distinguish the output of the BBC from any other television company.

The TV licence is not fit for purpose.

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trevorjharris's 367 posts GB flag
Briantist
sentiment_very_satisfiedOwner

6:17 PM

trevorjharris: I just read your comment at the gym and I've been chucking to myself all the way back home.

The scoring system isn't ridiculous: it just takes in all your objections and assigns them a score against different means of collection.

The reason you would want to weight the responses is that you a have a single view the something that has worked for the last 90 years is suddenly a "mad way to fund the BBC".

As for "There is little to distinguish the output of the BBC from any other television company", there is one: it doesn't show adverts for 16 minutes or more an hour. To some people, but not you of course, that is

Now, if you're going to keep on claiming that the "TV licence is not fit for purpose" tell me what my ten criteria should be and explain a weighting system that does not beligh prejudice!

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Briantist's 38,910 posts GB flag
J
James
6:48 PM

IMHO

Mobile Phone Surcharge -Demographically unfair - loads payment on young adults
Tax On TV Subscriptions -Illogical, those have chosen non-BBC services pay
Mobile Phone Usage - Demographically unfair-young and middle aged pay
Broadband Tax- Demographically unfair-young and middle aged pay
General Taxation - hopeless, Westminster will control the BBC
Council Tax - A good option in my view, payment by household,some linkage to wealth
Electricity Tax - Another good option but the energy suppliers would fight it tooth & nail
License Fee - No longer practical, time has passed it by
Subscription via Sky Virgin -Illogical, those have chosen non-BBC services pay
VAT extra charge - Another good option, but Westminster could control the Beeb
Tax On electrical items -totally impractical it would put up prices enormously
PAYE all Tax Bands -Politically controllable
PAYE higher only - No correlation between those who pay and those who view
PAYE on the top 1% - The rich would control the Beeb.

In my view Council Tax Levy is best. Local authorities are too diverse to bring focussed political control to bear. There is some linkage to wealth & It encourages local and regional responsibility (though I agree with you that regional TV costs are un-sustainable.)

Why are we not seeing this quality of journalism in the national press? - This site just gets better.

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James's 11 posts GB flag
MikeP
sentiment_very_satisfiedPlatinum

9:34 PM

James
Older people use the internet so would pay a 'broadband tax' as well.
Anyone who has a mobile phone would pay a mobile phone tax irrespective of age.
Tax on TV subscriptions would be payable by everyone using the service and not just those receiving via mobile or broadband.
Council tax currently is based on a property valuation done in 1991 and is so outdated. It also takes no account of household income so can be unfair to the unwaged and people on only a State Pension.
Licence fee is still workable but needs updating to cater for newer means of delivery and viewing.
The subscription model, like that used by Sky, is very expensive and unwieldy and no DTTV equipment has the facilities built in as yet.
Electricity tax would be a nightmare to implement and why should those without the facilities to view pay anything?
Your other points are, as you suggest, unbalanced as they penalise one section over another or is politically a nightmare.

What we need is a scheme that has minimal bureaucracy, so that leaves out local councils and HMRC.

IMHO we are better off with an updated TV Licence scheme that is simple to understand and simple to administer and does not allow any particular section of society to have any controlling influence over other in terms of editorial policy or output of the broadcasters.

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MikeP's 3,056 posts GB flag
M
MikeB
sentiment_very_satisfiedPlatinum

11:00 PM

James: I was going to reply to your post, but MikeP got there first with pretty much what I was going to say!

The problem with all these alternatives is that they are an attempt at an ideological solution to a problem that largely, in a practical sense, does not exist. Yes, the licence fee does not discrimminate on grounds of income or use, but neither does your phone's standing charge - its a flat rate, as is Sky's minimal package. If your over 75, you get it free, and frankly, its still a lot cheaper than any subscription package.

I can certainly see the advantage of the German system, as KMJ suggested, since pretty much everyone has a TV, radio or a PC, but there are exceptions, and so perhaps its better to leave it be.

Charles Stuart - Iplayer is about to be pay-per-view for certain things (like Netflix), it already on Itunes, and there is no reason at all that Iplayer should only be accessable via a code from your TV LIcence which you register (Now TV works in this way). If your using it, your paying for it.

One of the problems with the 'multi channel licence fee is old school' brigade is that they are only seeing things from their point of view. If you have a fast broadband connection, a Smart TV or Apple TV, etc then this 'download world' is normal, and thus subscription sounds both ideologically/politically attractive and technically possible. They are also the type of people who will rave about Breaking Bad, not Mrs Brown's Boys.

However, most people still watch TV live, many dont have HD and perhaps dont record at all, and have no idea if their TV have smart features, or how to use them. And a good percentage dont have broadband, a 3/4G phone, etc. They like Strictly, Meet the MIdwife, etc. They will also never write a column about why the licence fee is archaic, because they probably have never thought about it, and its something which works fine for them.

The licence fee works. Yes, there is evasion, but even Sky/Virgin suffers from that, and where there is evasion, people need to understand that that is not acceptable. Iplayer loopholes can be closed. The reason there is a 'crisis' is because the licence fee was frozen, and the BBC was expected to do more things with less money. We know that the BBC or licence fee isn't perfect, but FDR put it nicely in 1935 -

'It must, however, be recognized that when an enterprise of this character is extended over more than three thousand counties throughout the Nation, there may be occasional instances of inefficiency, bad management, or misuse of funds. When cases of this kind occur, there will be those, of course, who will try to tell you that the exceptional failure is characteristic of the entire endeavor. It should be remembered that in every big job there are some imperfections.'

Trevor Harris might keep insisting that the licence fee 'is not fit for purpose', but he has no empirical evidence to support that, only words.


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MikeB's 2,579 posts GB flag
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