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| Version 0 | Version 1 |
|---|---|
| Government 'split' on licence fee | Government 'split' on licence fee |
| (10 minutes later) | |
| The cost of a television licence fee is likely to go up in line with inflation, government sources have revealed. | The cost of a television licence fee is likely to go up in line with inflation, government sources have revealed. |
| The BBC has asked the government for a rise of 2.3% above inflation for the next seven years, meaning the licence could rise to £180 by 2013. | The BBC has asked the government for a rise of 2.3% above inflation for the next seven years, meaning the licence could rise to £180 by 2013. |
| But the cabinet is split, according to BBC Business editor Robert Peston. | |
| The prime minister and chancellor are backing a rise below inflation, while the culture secretary is pushing for a higher rate, Mr Peston said. | |
| It means a compromise is now most likely, he added. | |
| The BBC argues the increase in the licence fee - currently £131.50 - is needed for on-demand services and more quality programming. | The BBC argues the increase in the licence fee - currently £131.50 - is needed for on-demand services and more quality programming. |
| Uncertain outlook | Uncertain outlook |
| It has yet to be decided whether the costs of funding digital switchover - turning off the analogue signal that has provided terrestrial television since inception - should be funded separately from the licence fee. | It has yet to be decided whether the costs of funding digital switchover - turning off the analogue signal that has provided terrestrial television since inception - should be funded separately from the licence fee. |
| A financial settlement to cover the whole 10-year period of the BBC's new charter is highly unlikely. | A financial settlement to cover the whole 10-year period of the BBC's new charter is highly unlikely. |
| Ministers believe the outlook for the industry is too uncertain to guarantee a whole decade of funding, so the new licence settlement is expected to cover between three and five years. | Ministers believe the outlook for the industry is too uncertain to guarantee a whole decade of funding, so the new licence settlement is expected to cover between three and five years. |
| A decision is expected this autumn, probably next month and will take effect from April of next year. | A decision is expected this autumn, probably next month and will take effect from April of next year. |
| Earlier this year ITV said that the BBC was asking for too much, with then-boss Charles Allen saying the calculations had been done on the "back of a fag packet". | Earlier this year ITV said that the BBC was asking for too much, with then-boss Charles Allen saying the calculations had been done on the "back of a fag packet". |