The BBC will introduce a means-tested TV license fee for Pensioners over the age of 75 from June next year.
Under the new rules, over-75s who already receive the means-tested Pension Credit benefit will continue to benefit from the free license, which costs £154.50, and it’s estimated that 1.5m households are still eligible.
The UK Government’s current scheme – under which no one over the age of 75 need pay for the license – comes to an end next year and Parliament, through legislation, gave the responsibility to the BBC Board to make a decision on whether to end this concession, which was first introduced in 2001.
The BBC’s decision to scrap the free license but keep in place a means-tested option follows a consultation the broadcaster put out to viewers, which received almost 200,000 responses.
According to BBC Chairman Sir David Clementi, while many viewers voiced support for the Government’s concession, there was also strong support for reform and least support for abolishing the concession entirely.
Clementi said that copying the government’s current scheme would have been “untenable”, costing the broadcaster £1bn by the end of the decade, ultimately leading to the erosion or closure of “major services”
He added: “Linking a free licence for over-75s to Pension Credit was the leading reform option. It protects the poorest over-75s, while protecting the services that they, and all audiences, love.
“It is the fairest and best outcome. It is one we can implement and endorse. This is an outcome that is the fairest possible in difficult circumstances.”
The new scheme is estimated to cost the BBC around £250m by 2021-22.
The corporation said that the money would be funded by diverting programming and services spend, alongside continuing to find new savings while expanding its commercial revenues to cope.
BBC director general Tony Hall revealed the news to staff in a company-wide address on Monday (10 June) afternoon. “This has not been an easy decision,” he said.
“Whilst we know that pensioner incomes have improved since 2000, we also know that for some, the TV licence is a lot of money.
“I believe we have reached the fairest judgement after weighing up all the different arguments.”
The changes will come into effect on 1 June, 2020.