TV License Fee to Rise, with Support for More Households
The cost of a TV licence will increase tearins
by £5 in 2025, the government has announced, bringing the annual cost to £174.50. This increase, while less than the £10.50 rise implemented earlier this year, will still impact millions of households already facing rising costs of living.
Easing the Burden
The government is also expanding the Simple Payment Plan (SPP) scheme, allowing 9,000 additional households facing financial hardships to spread the cost of their licence over manageable fortnightly or monthly payments.
This rise is in line with the agreement made in 2022 that will see the cost of a TV licence rise in line with inflation each year until 2027.
The government has reinstated its method of calculating the increase by using an annual inflation rate as opposed to the monthly one used last year.
Looking Ahead: A Review of BBC Funding
The government has announced it will scrap a review of the BBC’s funding model that was in motion under the previous government and disband the expert panel. Rather than a standalone review, the government proposed to examine BBC funding as part of the upcoming Charter review process. The review of the BBC’s charter is expected to be completed before the broadcaster’s current royal charter expires in 2027.
‘Start’
The charter outlines the terms and purposes of the BBC’s existence, usually remaining in effect for a decade.
The review, as announced, will encompass the input of independent experts, stakeholders, and public opinion toescence on how best to support the BBC’s long-term future.
Essential Public Service
Culture Secretary Lisa Nandy emphasized the importance of the BBC, stating, “The BBC provides much-needed programming for households across the country, including vital education for children, world-class entertainment, and trusted news for everyone, wherever they live.
I want to see it thrive for decades to come.
Through the Charter Review, we will have an open national conversation about the broadcaster’s long-term future, ensuring the BBC has a sustainable funding model that supports its vital work while also being fair and responsive to those who pay for it.
In the meantime, we are providing the BBC with stability in terms of funding and supporting thousands more households
facing financial difficulties to better manage the cost of a TV licence.”
Foreign Secretary David Lammy added, “We are also providing £32.6m in additional funding for the BBC World Service in 2025-26, underlining our commitment to this vital international service.”
How will the TV license fee increase impact viewers already struggling with the cost of living?
## Interview: TV Licence Fee Increase
**Host:** Welcome back to the show. Today, we’re discussing the recent announcement of a TV license fee increase. Joining us to break down what this means for viewers is financial expert, Sarah Jones. Sarah, thanks for being here.
**Sarah:** Thanks for having me.
**Host:** So, the big news is a £5 increase, bringing the annual cost to £174.50. How will this impact viewers?
**Sarah:** [[1](https://www.bbc.com/news/explainers-51376255)]As you mentioned, this is on top of a more significant increase earlier this year. While £5 might not seem like a lot on its own, for millions of households already struggling with the cost of living, every bit counts.
**Host:** The government presented this as a necessary measure tied to inflation. Is this a valid justification?
**Sarah:** It’s certainly part of the picture. The government has returned to using an annual inflation figure to calculate the increase, rather than the monthly figure used last year, which was criticized for being overly sensitive to short-term fluctuations. However, it’s worth noting that this increase comes at a time when many people are already feeling the pinch.
**Host:** There’s also news of an expansion of the Simple Payment Plan scheme. Can you tell us more about that?
**Sarah:** That’s right. The scheme, allowing households facing financial hardship to spread the cost of their license through installments, will now be available to 9,000 additional families. It’s a positive step, allowing more people to access public service broadcasting while managing their budgets.
**Host:** The government has also announced they are scrapping a review of the BBC’s funding model. What are your thoughts on this decision?
**Sarah:** It’s a complex issue. Some argue the review was necessary to explore alternative funding models for the BBC, given the challenges of an ever-changing media landscape. Others believe the current system, with its reliance on the license fee, is still the best way to ensure the BBC’s independence.
**Host:** Interesting point. Thank you for shedding light on this, Sarah.
