• UK culture secretary Nicky Morgan discussed BBC funding to select committee
  • Morgan said she was “open-minded” about moving BBC to Netflix-style subscription model
  • Minister told MPs she would not force BBC to overturn over-75s licence fee decision

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TV licence: ’Netflix-style’ fee considered as replacement

UK culture secretary Nicky Morgan has said she’d be open to the idea of ditching the BBC’s licence fee and replacing it with a subscription service.

Speaking to the Department for Digital, Culture, Media and Sport select committee, Morgan said she was “open-minded” about the idea of switching the BBC’s funding model to a Netflix-style subscription service.

Responding to a question from Conservative MP and committee member Julian Knight, Morgan said: “I’m open-minded and I will have decisions and listen to evidence on all sides.

“What I haven’t seen is any evidence, either way, what a subscription-based system would do in terms of the revenue.

“The licence fee last year raised £3.7bn for the BBC. They obviously have other sources of income as well. So I would need to understand what, if you were going to change, that would do to their income.”

Scrapping the licence fee has long been a priority for some members of the Conservative Party, but according to a report from the Guardian, it is not a priority for the minister.

The BBC’s current charter period is due to last until 2027, with the government committed to maintaining the public service broadcaster’s funding model during the 11-year spell.

With the popularity of SVoD services such as Netflix and Amazon Prime Video growing in the UK, the BBC has faced increasing pressure. On top of this, the likes of Disney and Apple are set to launch new services in the coming year, increasing competition further.

To counter this, the BBC recently announced a major revamp of its on-demand iPlayer platform, while the corporation has also partnered with rival British broadcaster ITV to launch BritBox in the UK – a streaming service that will offer “best of British” content.

The licence fee remains the BBC’s primary source of funding, raising £3.7 billion last year, with additional funding coming from commercial enterprises and overseas sales of its programmes through BBC Worldwide.

“I think we all know from streaming services and everything else, and the way the younger generation consumes services, it is going to change,” Morgan added.

She was speaking to the committee on the BBC’s decision to revoke free TV licences for over-75s – a decision that has been criticised by the government.

Morgan said she had “no plans” to intervene into the decision, which was made following negotiations with former chancellor George Osbourne over the BBC’s funding model back in 2015.

The DCMS committee recently challenged the BBC and the government to work together to protect free TV licences for all over-75s, calling the decision to scrap the free fees for some over-75s an “absurd situation”.