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TV Licence replacement: is going to be French, Finnish or German?

Back in February 2015, the Culture Media and Sport Committee of the House of Commons published their Future of the BBC report. It looked at three other systems in use to collect money for the public service broadcaster. Which do you like?

John Whittingdale  Photograph: The Guardian
John Whittingdale Photograph: The Guardian
published on UK Free TV

Given that the chair of that Select Committee is now the Minister, I thought it might be instructive to look at the two alterative systems for funding the BBC within that report (click here to download).

The report looked into three other systems, one from Finland, the French one and the other from Germany.

Finnish system

Since 2013, the TV licence in Finland has been replaced by everyone 18 and over.   This YLE tax is set at rate of 0.68% of income.  It does have two protections: if the contribution is below £38, no charge is made (income of less than £5600); and the maximum personal contribution is £103.

In effect the unemployed and students don't have to pay.    Those without a TV set on middle incomes have found themselves having a new tax to pay. 

"Given that the system was only introduced in 2013, it is probably too early to judge its success."

The problem with such a system in the UK is that the current PAYE system isn't really up to it, and a large number of people make other arrangements because they are self-employed, have more than one job or have investment income.     

German system: Rundfunkbeitrag

Again, since 2013, the old system based on the number of "broadcasting receiving devices" was changed to a universal flat fee per household, regardless of television usage.  Some unemployed and student households are exempt. 

Given that the old evasion level was higher than thought, the new levy is lower than the old licence fee whist maintaining income. 

Given that it would be a reasonably trivial matter to change the basis of the UK TV Licence to "all households", this would not address the perceived issue of such a tax not being progressive (in the sense that the more you earn, the more you pay).

The Select Committee said: "The German model of a broadcasting levy on all households is our preferred alternative to the TV licence.  We recommend that the independent panel and Charter Review process should investigate the advantages and disadvantages of a household broadcasting levy as an alternative to the licence fee and on how the broadcasting levy could be made more affordable for low income groups in the UK. We also believe that the new Finnish system, of a hypothecated tax specifically for broadcasting, based on an individual’s income, although still its infancy, would still be worth consideration during Charter Review".

 

France

"In France, the television licence is collected with the French equivalent of their council tax (taxe d’habitation). One advantage of collecting a licence fee with another tax or through a utility bill is that the collection costs can be shared with another body and reduced. If the licence fee were collected through the Council Tax or with a utility bill, nonpayment could be pursued through the civil courts."

The issue of making a public service broadcaster tax "progressive" could be addresses by using the council tax banding to make the fee higher in households with larger properties.   The system already has scope for discounts for single households. 

Also, the committee notes that

"While the licence fee annual collection cost appears extremely high, BSkyB told us that £100 million was nothing compared to what the BBC would need to spend on marketing in order to retain subscribers."

 



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Comments
Friday, 15 May 2015
A
Andy Ell
3:11 PM

There is a problem with civil liberty. Although for many people, myself included, TV is an 'essential service', it is not a matter on which life depends, and does not have to be watched or provided. For those who do not watch TV, (and nobody has to) imposing a 'tax for TV services' is unfair and unjustified. At present no one has to pay a license fee if they don't watch TV. So if you choose not to put a car on the road, you don't have to pay road fund license. (I realise do we pay tax towards roads through general taxation.) The big unsolved problem seems to me to be how to fund the BBC in some other way? In my view it has to be a choice, not imposed.

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Andy Ell's 10 posts GB
Briantist
sentiment_very_satisfiedOwner

3:58 PM

Andy Ell: According to the report, the BBC is "reaching 96% of the population on a weekly basis".The whole point of the replacement system is that it isn't for TV. It's for what it already pays for: TV, radio and online.It won't be called a "TV Licence", but a "household broadcasting levy". See, no TV mention, it doesn't matter if you don't have one.

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Briantist's 38,846 posts US
T
Thomas
5:20 PM

With all due respect , why should I have to pay for something that I do not use or want?

To be forced to pay for a service that I do not require would be wrong ! I, like many others, can live without the BBC.

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Thomas's 1 post GB
R
ric tay
5:38 PM

Whatever system we have there should be a cull of the bloated BBC management and production. Outsourcing program making and buying in programs from independent makers should be the norm.

There is no reason why particular time bands could not be sponsored by commercial advertisers, although those interests should not be allowed to influence program content.

And just how many channels does BBC need?

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ric tay's 2 posts GB
Briantist
sentiment_very_satisfiedOwner

5:55 PM

Thomas: "why should I have to pay for something that I do not use or want? "It's called "government".

Living in a civil society, we all have to pay for things we don't use. Most people don't have school age children, but everyone pays for schools, for example.Given that 96% of the population use BBC services every week, you would be a serious oddity if you were one of the 4%.

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Briantist's 38,846 posts US
Briantist
sentiment_very_satisfiedOwner

5:59 PM

ric tay: "bloated BBC management and production"

Of course. The best way to get an organization to spend 3 billion quid wizely is to get rid of the management .

That ALWAYS works.

And, of course the BBC does NOTHING but produce TV and radio programmes. That can EASILY be done without production.

I'm not sure you're thinking things though.

"could not be sponsored by commercial advertisers"Are you sure that ITV would want that? Given that would take away ALL of the existing commercial broadcasters income at a stroke. See TV Licence decriminalization: just how much is it going to cost you? for the figures.

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Briantist's 38,846 posts US
Ian
sentiment_satisfiedGold

6:06 PM

HMM... Maybe I'm just cynical but this just sounds like an excuse to squeeze more money of of the public.

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Ian's 497 posts GB
Briantist
sentiment_very_satisfiedOwner

8:33 PM

Ian: Not more money, the same money.

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Briantist's 38,846 posts US
I
Ian Edge
9:03 PM

I think a tax on Sky TV equivalent to the amount the TV licence costs for the whole of the U.K.
would be the way to go to replace the anual charge for the TV licence.

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Ian Edge's 6 posts GB
M
MikeB
sentiment_very_satisfiedPlatinum

11:05 PM

Briantist: You've laid out the logical, sensible possibilities of an alternative to the licence fee (if one is needed). Sadly, this 'debate' is not going to be logical, sensible, or anything else. Instead, the choice BBC funding over the next five years will be marked by dogma, crass commercial self-interest masked as ideology, political free-market nihilism, and thermonuclear levels of lying and stupidity. Basically its Dunning Kruger as performance art, which (sadly), we've already seen on this thread.

I agree that the Finish system has a problem with regards to the UK - the intrastructure simply isn't up to the job. Ian Duncan Smith might say that Universal Credit works fine, but nobody else is convinced, and you'd be looking at a similar level of complexity.

The German system has much to commend it. Its simple, straightforward, and since pretty much everyone has a TV or uses the net, everyone is covered. However, the biggest moans about the licence fee are:

'I have no choice - I have to pay it' (you might say the same about Car Tax),

'I dont use the BBC, why should I pay for it' (96% plus use it on a weekly basis, so your probably lying)

'It's a tax!' (call it a 'user fee' instead - happy now?)

'It doesn't reflect the ability to pay' (True, but niether does Sky or your Gas bill)

'Its the principle of the thing!' (Life isn't perfect - get used to it)

Alas, the German system doesn't answer any of these, and actually makes it slightly worse. At least if you dont have a TV, you pay nothing. If the BBC made Iplayer only available if you've paid you licence fee (perfectly doable), then that loop-hole would be closed up anyway, and there would be little difference between the two. I think the German system is perfectly sensible, but its not going to happen, if only because its a German idea, which is unlikely to find favour with certain tabloids.

Much can be said of the French system - logical, but French! Unfortunately, that sysyem is out of the question, because Council tax is a nightmare. The banding hasn't been changed in decades (because government is terrified of the outcry), and many councils will do almost anything other than actually raise those rates (my local council boasts of leaving it as it is, yet has a huge deficit). Politically - its a no go.

The most sensible option - leave the system for now, raise the fee to a level which covers the inflation of the past 5 years, etc, and stop it bleeding money through having to pay for whatever nonsense Jeremy Hunt though up 5 years ago.

Unfortunately, thats not going to happen. The Tory Party has both ideological and other reasons to destroy the BBC (their patron doesn't like it), and so they will keep the licence fee at the same level, which amounts to a cut after inflation, just as its has suffered for the past 5 years. This (in US GOP circles), is called 'starving the beast', where you cut off as much funding as you can. You can then claim you didn't kill it - it died of natural causes.

It will of course get worse. The next charter renewal will see even more burdens put on the BBC - apparently the BBC local news is responsible for the death of local newspapers (I thought it was the net and the fact theat they are a bit rubbish), so money will go to that, plus whatever whimsical idea enters Whittingdales mind. LW will not be going!

This has the advantage of stretching BBC finaces still further, which will lead to cuts in services, which will be unpopular, and lower quality, which will be an excuse to lower the licence fee still further. There will also be endless investigations, 'scandals' (the Daily Mail and Sun will be busy), and of course at least one report a year written by a friendly hedge fund manager, which will lay out how things must change. Every bit of election coverage will be looked over for 'bias', which of course will be found.

Ultimately, the BBC will wither on the vine, and then the American system will come into play. A tiny PBS, funded by an unwilling government and whatever assets it has been left with. It will do its best, but its funding will be subject to the whims of politicians, and its news output will be anodyne and non threatening (just listen to NPR for a taste). The BBC will be killed like a boa constrictor kills - slowly, by squeezing again and again. Except that those doing it will not need to eat, just to prove that the free market must always be best, and because someone lse will make money.

Of course it doesn't have to be this way. The Tories have a small majority, and David Cameron knows that the BBC is a much loved institution which is vastly more trusted than any politician. Whittingdale and others are zealots, who often over-reach, and the press is powerful, but its not all-powerful. Ultimately, people actually like the BBC, and killing it will not be easy, even if the Tories want to. However, lets not get lulled into the Wykehamist Fallacy - there are many who would cheerfully kill the BBC, just because they can.

If you want to see what the BBC does do, look at PBS in US - they dont make drama, becuase they cant afford to. They buy ours - the bulk of it from the BBC - PBS: Public Broadcasting Service
Someone thinks the BBC does a good job - perhaps we should as well, and fund it properly.





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MikeB's 2,575 posts GB
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