Cost of TV licence is going up next year, Government says

The Government has announced that the cost of a TV licence will go up again next year. Almost everyone will have to pay an extra £5 as the licence fee rises to £174.50 a year.

Culture secretary Lisa Nandy said the licence fee would continue to run until 2027, adding: "The BBC provides much-needed programming for households across the country, including children's education, world-class entertainment and trusted news for all people in all parts of the UK. I want to see it thrive for decades to come.

“Through the Charter Review, we will have an honest national conversation about the broadcaster’s long-term future, ensuring the BBC has a sustainable public funding model that supports its vital work but is also fair and responsive to those who pay for it. In the short term, we are providing the BBC with funding certainty, while supporting thousands more households facing financial hardship to spread the cost of a TV licence.”

A TV Licence in the UK is a legal requirement for households, businesses, and organisations to watch or record live TV broadcasts or to use the BBC’s streaming services like BBC iPlayer. The licence fee is a mandatory charge, regardless of the broadcasting service you use, if you consume live TV content or BBC iPlayer.

It is used to fund the British Broadcasting Corporation (BBC), ensuring its ability to provide public service broadcasting without reliance on commercial advertising.

In 1922, when the BBC was formed, it began as a privately funded organization. The first radio licence was introduced in 1923, costing 10 shillings (equivalent to about £30 today). The licence ensured funding for the BBC, which was tasked with providing impartial, high-quality programming.

The TV Licence was introduced in June 1946 after the resumption of television broadcasting post-World War II. It initially cost £2 (around £90 in today’s money) and covered black-and-white TVs. With the advent of colour TV, the licence fee for colour television was set at £10, higher than the fee for black-and-white sets.

The BBC remained free from advertising and politically influenced sponsorships, relying on the licence fee as its main source of revenue. As TV viewing evolved, the licence was expanded to cover live digital TV broadcasts and, later, BBC iPlayer (in 2016).

Free licences for those over 75, previously funded by the government, have largely been withdrawn except for low-income households. Discussions about alternative funding models are ongoing, with some advocating for a voluntary subscription system or government funding through general taxation.