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| Version 1 | Version 2 |
|---|---|
| Ministers agree TV licence deal | Ministers agree TV licence deal |
| (20 minutes later) | |
| The culture minister and chancellor have agreed a deal on raising the TV licence fee, the BBC has learned. | The culture minister and chancellor have agreed a deal on raising the TV licence fee, the BBC has learned. |
| But the agreement reached by Tessa Jowell and Gordon Brown has not yet been given the nod by Tony Blair. | But the agreement reached by Tessa Jowell and Gordon Brown has not yet been given the nod by Tony Blair. |
| Under the plan the fee should rise 3% in 2007 and 2008, 2% in the next three years and between 0% and 2% in 2012, depending on digital changeover costs. | Under the plan the fee should rise 3% in 2007 and 2008, 2% in the next three years and between 0% and 2% in 2012, depending on digital changeover costs. |
| The decision means that the licence fee will rise to £135.45 next year from its current level of £131.50. | The decision means that the licence fee will rise to £135.45 next year from its current level of £131.50. |
| By 2012 the cost of a TV licence could be as low as £148.05 or as high as £151. | By 2012 the cost of a TV licence could be as low as £148.05 or as high as £151. |
| Finance worries | Finance worries |
| The level of increase is unsure for year six because of the uncertainty over the financial cost of the changeover from analogue to digital TV. | The level of increase is unsure for year six because of the uncertainty over the financial cost of the changeover from analogue to digital TV. |
| BBC LICENCE FEE RISES Now: £131.50Year 1: £135.54, up 3%Year 2: £139.51, up 3%Year 3: £142.20, up 2%Year 4: £145.15, up 2%Year 5: £148.05, up 2%Year 6 - £148.05-£151, 0-2% rise | |
| BBC Business Editor Robert Peston said it was not all bad news for the BBC as the deal agreed meant the licence fee would rise broadly in line with the headline rate of inflation - the Consumer Price Index, which excludes mortgage payments. | BBC Business Editor Robert Peston said it was not all bad news for the BBC as the deal agreed meant the licence fee would rise broadly in line with the headline rate of inflation - the Consumer Price Index, which excludes mortgage payments. |
| "In theory this is less than inflation, in the sense that Retail Price Index is 3.9% at the moment. And I am sure the Treasury will claim this as a tough settlement," he said. | "In theory this is less than inflation, in the sense that Retail Price Index is 3.9% at the moment. And I am sure the Treasury will claim this as a tough settlement," he said. |
| "But on a running CPI basis, I think it can be seen as broadly in line with inflation - the Bank of England's CPI target rate is 2%." | "But on a running CPI basis, I think it can be seen as broadly in line with inflation - the Bank of England's CPI target rate is 2%." |
| News of the deal comes just weeks after Michael Grade quit as BBC chairman during key talks over the licence fee. | News of the deal comes just weeks after Michael Grade quit as BBC chairman during key talks over the licence fee. |