BBC bosses have decided to cut the number of over 75 year olds eligible for a free TV licence by restricting the benefit to only those who are in receipt of pension credit.
As part of the BBC’s latest funding agreement with the Government, the broadcaster became responsible for deciding whether to offer the concession after June 2020.
Last year the corporation estimated that continuing the current concession would cost cost £745m by 2021/22.
Managers warned such a price tag would force them to “fundamentally change” how they deliver services and would force them to cut back spending on content.
Following a public consultation, the BBC Board has decided to retain free TV licences but only for over 75 year olds who receive pension credit. They claim that “around 1.5 million households could be eligible”.
BBC Chairman Sir David Clementi said: “The BBC has conducted the biggest and most wide-ranging consultation in its history.
“It has proved invaluable in helping the Board make its decision. While many supported copying the Government’s concession – so that all over 75s received a free TV licence – there was also strong support for reform.
“There was least support for abolishing the concession entirely.”
Director-General Tony Hall added: “This has not been an easy decision. 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.
“It would not be right simply to abolish all free licences. Equally it would not be right to maintain it in perpetuity given the very profound impact that would have on many BBC services.”
Responding to the news, Damian Collins MP, Chair of the House of Commons’ Digital, Culture, Media and Sport Committee which scrutinises the BBC, said BBC bosses would face questions from his committee over their decision.
He said: “The ending of historically free TV licences for all those over 75, regardless of income, will mark a significant departure for the BBC and nearly four million pensioners who don’t pay for it.
“However, we know that the total cost to the BBC of picking up the provision of free licences was estimated at £725 million in the coming years, and growing.
“The likely bill for paying for licences for those who receive Pension Credit is put at around £250 million which is still a considerable sum. We at the DCMS Committee will continue to monitor the BBC, and in particular the impact that this cost will have on the BBC’s future and its programming.
“The select committee intends to question the Chairman and Director General of the BBC about the results of its consultation and the impact this will have on viewers and listeners.”