George Osborne scores victory over BBC as broadcaster agrees to foot £650 million bill for free TV licences

http://www.independent.co.uk/news/uk/politics/george-osborne-scores-victory-over-bbc-as-broadcaster-agrees-to-foot-650-million-bill-for-free-tv-licences-10369824.html

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Taxpayers will no longer foot the bill for free TV licences for the over-75-year-olds from 2020 after the BBC agreed to start fully funding the universal benefit.

It is a victory for George Osborne, the Chancellor, after revealed on Sunday that he had asked the BBC to start covering the £650 million cost of free TV licences to make a “contribution” to balancing the nation’s books. 

John Whittingdale, the Culture Secretary, confirmed this afternoon that the broadcaster will begin taking over responsibility for providing free TV licences from 2018/19, saying it was important that it should “play its part in contributing to reductions in spending like much of the rest of the public sector”.

George Osborne said he had asked the BBC to start funding free TV licences for the over-75s He added that the government will “consider carefully” the case for decriminalising non-payment of the £145.50 licence fee. The plan was first revealed by The Independent last month.

He hinted that the government would soon allow the broadcaster to start charging for people to use the iPlayer as he said legislation would be introduced next year to “modernise the licence fee” to cover public service broadcast catch-up TV.

Mr Whittingdale pledged to reduce the BBC’s “reliance on taxpayers” but Labour labelled the “backroom deal” between the government and the BBC as “shabby”.

The £650 million savings for the taxpayer will contribute towards Mr Osborne's £12bn of cuts to the welfare budget. He will announce further details of where the axe will fall in Wednesday's emergency budget.

The Chancellor, appearing on the Andrew Marr Show yesterday, accused the BBC of being “imperial” in its global ambitions – notably its website -- but allies denied that Mr Osborne was launching an attack on the corporation. He praised it as “an important national institution and a fantastic broadcaster that produces some of the best television and radio in the world.”

However he said: “The BBC is also a publicly funded institution and so it does need to make savings and contribute to what we need to do as a country to get our house in order.”