Labour Culture Secretary Lisa Nandy has proposed a significant change to the BBC funding model that could require users of streaming services such as Netflix, Disney+, Amazon Prime Video, and Apple TV to pay an additional charge as part of their subscription. The proposal, outlined to MPs, aims to address the BBC's declining licence fee revenue while avoiding a new household tax.
Proposed Changes to TV Licence
Speaking to MPs, Nandy said: "We could add a charge to people's streaming subscriptions, which would be paid by the consumer. We could have a staggered approach, where someone might pay a small additional amount if they had a streaming service, rather than the full licence fee, or we could expand the scope to everyone who has one." She emphasized that the charge would be integrated into streaming bills, making it less burdensome for households already facing cost-of-living pressures.
Nandy ruled out funding the BBC through general taxation or a corporate levy on streaming services. Instead, she proposed several options: adding an extra fee to streaming subscriptions, requiring all streaming subscribers to pay the full licence fee, or introducing targeted concessions for those who use BBC services less or need financial support. She also suggested that expanding the scope could potentially reduce the licence fee for everyone.
BBC Funding Challenges
The proposal comes as the BBC faces a decline in licence fee revenue. Figures show that by the end of the 2025/2026 financial year, active licences fell by 540,000 to 23.3 million. The number of households declaring they do not need a licence increased by 62,000 to 3.7 million. The licence fee was raised to £180 earlier this year. Nandy stated: "We are genuinely having an open conversation with the public, Parliament and the BBC."
The BBC relies primarily on the licence fee for funding. The new plan aims to stabilise its finances by tapping into the growing streaming subscriber base, which has overtaken traditional TV viewing in the UK.
