The BBC needs to engage in new funding models that will safeguard its future, according to the Lords Communications and Digital Committee.
It says rapid changes in media, technology and consumer habits combined with increasing competition, mean the BBC must define its role and publish a new vision for how it will deliver for audiences and benefit the nation.
The Committee adds the BBC needs to expand its commercial operations and be “open minded about exploring more ambitious commercial options, such as domestic or international hybrid subscription services”.
It also warns that the BBC faces “stagnation and decline” if it doesn’t urgently set out a bold new plan for its future. The Committee says this needs to include costed options for future funding models that go beyond the existing licence fee system, which the Committee describes as “regressive”.
The report finds that some form of public funding will remain necessary beyond the existing licence fee settlement, but for any form of public funding to remain legitimate, the BBC “must do a better job of representing the full range of perspectives and communities that make up our diverse society”.
Baroness Stowell of Beeston, Chair of the Committee, said: “The greatest threat to the BBC’s future isn’t a battle amongst politicians about the licence fee – though decisions about how it is funded are important to get right and becoming increasingly urgent. The real danger is if the BBC doesn’t seize this opportunity to reform and demonstrate why it’s of value to audiences in this new world of endless choice.”
Alternatives to the Licence Fee, which the Committee describes as “regressive” include a universal household levy linked to council tax bills and reforming the existing licence fee to provide discounts for low-income households.
A BBC spokesperson, said: “We welcome the Lord’s report. We agree we need to keep reforming which is what we have been doing at pace. Clearly the BBC needs to keep relevant and we welcome the report’s finding that a market failure BBC wouldn’t be a good outcome. Beyond that, we are open minded about the future and it is right there is a debate on whether the licence fee needs to evolve and if so, what comes next.”
Last week, the Irish government overruled a committee proposal to replace the Licence Fee.
