Government hints BBC licence fee could be scrapped

By Elizabeth Howcroft and Costas Pitas

LONDON (Reuters) - Culture minister Nicky Morgan hinted on Wednesday that the annual BBC licence fee on Britain's television-watching households could be scrapped after the next review of its royal charter, as crunch funding talks with the broadcaster near.

The possibility of losing guaranteed licence fee money comes at a time when the 100-year-old BBC is under attack on several fronts ranging from accusations of extravagant spending to political bias.

"The licence fee will remain in place this charter period which ends in December 2027, however we must all be open-minded about the future of the licence fee beyond this point," Morgan said.

"These are not easy issues and they will require some honest and at times difficult conversations," she added.

Anyone who installs or uses a television or watches the BBC's streaming and catchup service iPlayer must pay the 154.50-pound ($198) charge or be guilty of a criminal offence, resulting in a fine of as much as 1,000 pounds.

Failure to pay can lead to a criminal conviction.

The government started an eight-week public consultation on Wednesday on whether non-payment should be decriminalised.

"As we move into an increasingly digital age ... the time has come to think carefully about how we make sure the TV licence fee remains relevant," Morgan said.

She said fewer young people were tuning into the BBC's radio, TV and online output, and "therefore we do need to look at this funding model."

The BBC has said decriminalisation will result in more people evading the fee, costing it millions in lost revenue.

"If there are changes, they must be fair to law-abiding licence fee payers and delivered in a way that doesn’t fundamentally undermine the BBC’s ability to deliver the services they love," the broadcaster said in a statement.

Prime Minister Boris Johnson raised the licence issue just a few days before December's general election which he went onto win with a large majority.

"I don't think anyone should interpret today's announcement or discussion about the licence fee model as any kind of attack on the BBC," Morgan said, describing the broadcaster as a beacon of freedom and light.

Wednesday's comments come after recent clashes between government and political journalists. Cabinet ministers are boycotting BBC Radio 4's flagship "Today" news programme and some journalists were barred from a government briefing on Monday, causing others to walk out.

The successor to the BBC's outgoing Director General Tony Hall will have to fight for the future of the organisation and its funding model, which some critics say is outdated in the era of subscription services such as Netflix.

But in recent years, the BBC has come under criticism for awarding extravagant salaries to its stars, paying some women less than men and for what some politicians say is a London-centric bias.

The BBC has also faced accusations of political bias from the government, the opposition Labour Party and Scottish nationalists which it has rebuffed.

(Editing by Paul Sandle and Stephen Addison)