BBC bosses are ‘open-minded’ about ditching licence fee as chairman refuses to ‘rule out anything’ 

The BBC top brass admitted today that they are ‘open-minded’ about abandoning the licence fee as the corporation appeared to accept its current funding method is likely to be axed.

Chairman Richard Sharp refused to ‘rule out anything’ when he was asked about a ‘two-tier’ system for the broadcaster, which could include a part subscription model. He said the BBC was facing an ‘existential question’ and would ‘look at all options’. 

It came after Culture Secretary Nadine Dorries signalled she intends to axe the £159-a-year licence fee when the current charter expires at the end of 2027, with plans for a review into how the BBC is funded. 

Appearing yesterday in front of the Lords communications and digital committee, there appeared to be a significant shift in tone from BBC bosses, who previously have concentrated on the merits of the current system. Director-general Tim Davie told peers that while the licence fee had ‘successfully delivered’, people at the BBC ‘care most’ not about the ‘funding mechanic’ but about its ‘values’ and being available to all. 

But he warned about the ‘unintended consequences’ if wrong decisions were made, and the ‘stakes’ in getting it right. 

Mr Davie also cautioned against ‘a lurch to youth’ across the whole of the BBC, saying it ‘must serve our core audience’. The BBC has been criticised recently for focusing more heavily on younger audiences. Mr Davie was asked by the committee about the ‘legitimacy’ of a funding system that was compulsory and cost the same for everyone, saying: ‘At the top level we believe in something that is available to all. Beyond that you have to be open-minded.’ 

Mr Sharp was asked if he would rule out ‘some form of two-tier BBC’. He replied: ‘The board hasn’t ruled out anything.’