The BBC is losing more than £1bn a year in potential licence fee revenue, according to a cross-party group of MPs. The Commons public accounts committee calculated that evasion and households declaring they do not need a licence are costing the corporation up to £1.17bn annually.
The evasion rate stands at 12.5%, costing up to £550m, while the number of households saying they have no need for a licence has risen from 2.4m in 2021 to 3.6m this year, representing a loss of up to £617m. Despite a 50% increase in visits to unlicensed homes last year, prosecutions fell by 17% in 2024.
MPs warned the BBC is under "severe pressure" as it negotiates the renewal of its charter with the government. The resignation of director general Tim Davie following criticism over a Panorama episode has added to turmoil at the top.
Critics argue the licence fee is harder to justify as viewers shift to digital platforms like YouTube and TikTok. However, BBC executives see the fee as essential for providing a universal service. Geoffrey Clifton-Brown, Conservative chair of the committee, said the traditional enforcement method of household visits is yielding fewer returns.
A BBC spokesperson said: "The licence fee needs reform. We are actively exploring all options that can make our funding model fairer, more modern and more sustainable."
