Members of Parliament have urged the BBC to reduce the cost of the television licence fee and restructure its funding model to ensure the broadcaster’s long-term sustainability. The recommendations come amid concerns over declining licence fee compliance and the need to adapt financing to changing patterns of media consumption.

In a report by the Commons Digital, Culture, Media and Sport Committee on the forthcoming review of the BBC’s Royal Charter, MPs highlighted that while 94 percent of households in the UK use the BBC’s services, only 80 percent currently hold a valid licence. They called on the corporation to extend the remit of the fee to cover all internet-enabled devices capable of receiving BBC content, including mobiles and laptops, rather than tying the charge solely to television sets.

The committee suggested that broadening the licence fee’s scope would be more acceptable to the public if accompanied by a lower individual cost, currently set at £180 annually. It also recommended that the government consider transitioning to a universal household levy to fund the BBC, though acknowledged that implementing such a system would pose significant challenges in the short term.

BBC Director General Matt Brittin informed the committee that the corporation had lost an estimated £1.2 billion to £1.3 billion in funding over the past decade, with approximately 40 percent of this shortfall attributed to a reduction in the number of households paying the licence fee. The committee further noted projections indicating that licence fee compliance could fall below 40 percent of households by 2037 or 2038 if current trends persist.

The report also expressed concern about widespread evasion, citing government data showing that although around 27 million households possess televisions, fewer than 24 million hold valid licences. The BBC acknowledged the need for reform, stating that a new funding model requiring contributions from a broader base at a lower cost per household could enhance equity and financial sustainability.

In addition to funding reforms, MPs recommended abolishing the decennial review cycle of the BBC’s Royal Charter, proposing instead to make the current arrangements permanent to remove periodic uncertainty over the corporation’s future. They also emphasized the importance of safeguarding the BBC’s editorial and operational independence by minimizing political interference.

The government is expected to announce its position on the BBC’s governance, regulation, and funding framework for the period beginning in 2028 in the coming months.