Culture secretary Tessa Jowell has confirmed that the BBC will still have to fund key elements of the digital switchover process from the licence fee.
Ms Jowell told the House of Commons that the BBC would receive an increase of 3% for the first two years of the settlement and 2% for years three, four and five. It means that the TV Licence Fee will rise to £135.50 in April and up to £151.50 by 2012. She said that based on treasury forecasts this would either be in line with or above inflation.
One sticking point is the £600 million the BBC was expected to spend on providing set-top boxes for the elderly and disabled. The Corporation had previously said it would fund the provision, but now says that such expenditure would put programmes in danger. It will also have to fund Digital UK’s £200 million promotional campaign.
The BBC may also be required to fund Channel 4’s move to digital at a cost of £14 million. The BBC has indicated to the Department of Culture that digital switchover will free up multiplex space for one video channel and three radio channels.
The BBC is expected to make a statement later today (Thursday) on the settlement and the move of its children’s, sports and new media departments to Manchester. (JC)