Bringing the BBC into the 21st Century

By Sam Packer, media campaign manager

Last Thursday was the UN’s world television day. Established in the 1990s, and perhaps not the most widely celebrated awareness day in an age where a new one arrives weekly, it is nonetheless a helpful reminder that television remains the single most used form of media the world over. When pondering the wonders of the small box with moving pictures, it is always worth remembering that everyone has to pay an annual tax for the privilege.

The BBC licence fee, paid on the basis of television ownership, in reality funds a huge media organisation. This includes not just television stations but a vast chunk of the radio and online news markets, both at home and overseas, as well as impressive press handling and public relations arms of its own. The annual TV tax funds one of the largest media empires in the world.

As proponents of reducing the tax burden, especially on ordinary people, the TaxPayers’ Alliance have been consistent champions of scrapping the television tax. But many politicians are deeply nervous about picking a fight with the BBC megalith. The Brexit Party and the DUP are the only two parties to openly advocate for scrapping the fee, though Tory ministers have appeared emboldened in recent months. Nevertheless, this is an issue MPs have been keen to avoid, particularly since the 2016 Charter Review. But the problems with the current BBC model are deep and unavoidable. 

The first question to be addressed is a simple one which has no truly satisfactory answer: why should the government own a huge chunk of any major industry? Though it faces new challenges from a resurgent drive for re-nationalisation, privatisation is one of the great successes of the late 20th century. Thatcher’s privatisations were economically transformative, made failing industries more viable, provided better value, higher quality services to the public and inspired similar movements across the world

Why should media be an exemption to this principle? If anything, media is one of the worst industries for governments to have a significant stake in. Government legitimacy stems from public opinion, and media is the main way in which the public are informed of government decisions. A natural conflict of interest emerges, even if defenders would point to the BBC charter and the guarantee of supposed neutrality. But even the perception of bias is all an ideological government would need to justify interfering with the BBC’s editorial line, with the power to do so.

Of course, the BBC is far from owning the entire media market. However, few would advocate in favour of the government owning by far the largest company in any other sector. Why should the media be an exemption? Were the BBC privately owned, the Competition and Markets Authority would have long since intervened over its extraordinary share of the market. A 2015 study, ironically intended to highlight the horrors regarding other private media owners, showed that the BBC had a 33% broadcast share of TV and 54% of radio. In virtually any other mass consumer industry those numbers would make us squirm - not least if the market leader was government-owned, comfortably funded by taxation, politically powerful and insulated from competitive pressure.

Putting questions of principle aside, there are plenty of practical reasons the license fee is not fit for purpose. Public money should not be lining the pockets of veteran broadcasters. Would it not make more sense for a 'public service' institution to maintain a strict limit on salaries and in so doing give far more opportunity to young talent? Other commercial services actually do a far better job of this.

What’s more, when a Netflix subscription is £8 a month, why should nigh on every household in the country be compelled to pay nearly £13 for content they have no choice in and they may never watch? How can even the most ardent socialist, who holds that public ownership is always preferable to private, endorse what is effectively a poll tax - only in this case those paying have no say over what services are provided from their tax receipts? It is taxation, without representation, levied on both the very richest and the very poorest.

The licence fee model means that there is no option for those who wish to avoid the BBC (and save money) to do so. That neutralises a great deal of the competitive pressures which are normal in almost every other part of modern life. It protects the BBC from scrutiny by providing them with guaranteed funding. There is no means of applying pressure on them to provide more content you want to watch or listen to by reducing your subscription, or consuming fewer adverts on the platform. The system effectively undermines the power of consumer choice. If the licence fee is such brilliant value, as the BBC and plenty of its advocates argue, why should it be worried by the public having a choice of whether to pay for it?

The upcoming UK launch of the joint BBC-ITV streaming service Britbox, which will charge customers a £5.99 subscription a month, shows that the BBC clearly believe its television output is good enough for people to pay for it willingly. So why not apply this to their general output? Perhaps the Britbox model can be an inspiration to the BBC going forward.

The licence fee is a hangover from a past media age. It is high time that politicians saw the problems in the system and put a stop to this annual poll tax. Whoever wins the election, when potential BBC ministers Nigel Adams or Lord Griffiths consider their planned reforms, bringing the licence fee into the 21st century should be the first thing on their mind.