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The Guardian - UK
The Guardian - UK
Business
Jason Deans

BBC licence fee deal: coming up £1.6bn short?

How about a little parlour game? You are policy adviser to BBC director general Mark Thompson, and have to help him lop £1.6bn off the corporation's spending plans, because they haven't got the inflation-plus licence fee deal they asked for.

The licence fee deal hasn't been announced yet, of course. But with the BBC saying it's now in the hands of the government, and Whitehall insiders briefing that the corporation will be lucky to get a settlement pegged to inflation - and possiby less - it's not looking good for Thommo.

He is asking for inflation plus 1.8%, to fund £5.5bn of extra spending on programmes, content and services between 2007 and 2014. The BBC reckons it can find £3.9bn of that through 'self help', but wants the 1.8% rise above inflation to plug the remaining £1.6bn gap.

So let's say the BBC gets a deal pegged to inflation - where are you going to cut the £1.6bn from?

Here's how the BBC's £5.5bn spending plans stack up, as set out in the October 2005 document, Delivering Public Value:

Digital infrastructure - including kitting out transmission masts for digital TV and radio, as well as investment in high definition TV, FreeSat and internet distribution - £700m.

Digital services - including the i-Player and other on demand projects, the creative archive, mobile, broadband and interactive offerings - £1.2bn.

Quality content - for the BBC's existing TV and radio services, includes replacing repeats and low cost derivative and 'copycat' programmes with higher quality/cost original drama, comedy, entertainment, children's and factual output - £1.6bn.

New local investment - including the Salford move, 'ultra local' TV services, a new TV region for central England, new radio stations, open centres and buses - £600m (of which £400m for Salford).

Increase in base costs - superinflation in broadcast costs such as sports rights and talent deals - £1.4bn.

Total = £5.5bn.

So - what goes, what stays? You decide...

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