BBC TV licence for over-75s
As you will be aware, people over the age of 75 are currently eligible for a free TV licence, which also covers anyone they are living with. This concession was introduced in November 2000 under the then Chancellor Gordon Brown. In 2015, the Office for Budget Responsibility estimated the cost of continuing the free TV licences to be £200 million in 2018/19, rising to £445 million in 2019/20 and £745 million in 2020/21. At the moment, the Government reimburses the BBC for the free TV licences, but funding of the free TV licence will transfer to the BBC from June 2020. It then becomes the BBC's decision whether to continue the concession in its current form.
The Government has made it clear that it expects the BBC to continue the concession. It must be borne in mind that the BBC evidently understood the level of commitment required when it agreed to the funding settlement, including taking on responsibility for the concession, in 2015. I recently co-signed a joint letter with my colleagues to the BBC, in which it was made clear that when the current BBC charter was negotiated in 2015 the agreement for the BBC to take on the funding for over-75 households was based on the their receiving several concessions in return, including linking the annual licence fee to inflation; introducing legislation to modernise the licence fee and aid revenue-gathering by closing a loophole covering catch-up TV; and an end to the BBC’s commitment to fund super-fast broadband around the country by 2020, which would have cost the BBC £80m in 2018 alone. I also recently met with representatives from the BBC to discuss the concession and a way forward, including a request to consider cost-cutting and the salaries of top stars and executives.
In 2015, I understand the BBC commissioned Frontier Economics to explore the long-term options for funding the over-75s concession. Following the publication of its report in 2017, the BBC consulted last year on possible options for the future. This was an important step in order to ensure the BBC is aware of the public's views on the subject. Over 190,000 people responded to that consultation, of which 52 per cent chose some form of change - 37 per cent ranking reform first and 15 per cent calling for the concession to be abolished to restore a universal licence fee. Frequently cited concerns were the issues of pensioner poverty and the importance of TV as a companion for the elderly, concerns with which I entirely agree. Following the consultation, the BBC came to the decision that the fairest option was to establish a new scheme that focuses on the poorest older pensioners. As a result, any household with someone aged over 75 who receives Pension Credit will be eligible for a free TV licence funded by the BBC, which will be effective from June 2020. This should hopefully ensure that those who cannot afford to pay for a licence will remain exempt from any requirement to do so.