I have received a great deal of correspondence about Free TV licences for the over those seventy-five years of age.
The Government is guaranteeing this concession, which costs £745 million per year, until 2020. Thereafter, the concession is the responsibility of the BBC. This was agreed at the last negotiation of the TV licence fee – which generates £3.85 billion annually for the BBC. In addition to which, the BBC makes another £1 billion or so, from its commercial activities, including selling programmes to other broadcasters.
When the agreement was reached with the Government that from 2020 the concession should be the BBC’s responsibility, the BBC’s Director General observed that the cost of the concession was more than matched by the funding settlement it had received.
The BBC has now decided to not to make the concession to all the over seventy-fives after 2020, but instead, to means-test it by confining the free licence only to pensioners receiving pension credit.
Frankly, given the settlement that the BBC got, and the agreement it made, I think that tax-payers are being short-changed.
I certainly don’t think that tax-payers should be expected to pick up the tab for this once again.
The BBC has ‘pulled a fast one’ and ought to reconsider.
Constituents have however, pressed me on the principle that TV licences should be free for the over seventy-fives. Here I have some difficulty – I don’t see why they should.
Every autumn, I get a dozen or so letters from pensioners embarrassed by receiving their winter fuel allowance. They complain that they do not need it and that it would be better spent by giving rather more to those in greater need. I agree with them. If the allowance were mean-tested we could afford to make a more generous payment to those who really need it.
I cannot see why the means-testing principle should not also apply to the TV licence too. Clearly there will be many who can well afford to pay for their own. A colour TV licence is £154.50 per year, that’s just over 40 pence per day.
My granny used to save-up for her TV licence. When I was a little boy, she would send me down the street to get her ‘messages’, by which she meant her shopping (and which, in those days, meant waiting to be served in a number of shops, rather than helping-yourself in a supermarket).
Often, this would involve a trip to the post-office to purchase her TV stamp: By collecting the weekly stamp, she spread the cost of purchasing her licence annually.
I am nervous about ‘moral hazard’ in the expectation that things should be free.
Pension Credit is currently under-claimed: Many pensioners who are entitled to it, are not claiming it. They will therefore, from 2020, also miss out on a free TV licence if they are over 75.
This should be a greater incentive to claim what they paid their national insurance contributions for, and live more comfortably as a consequence.
As for the rest of us, we should continue to pay for our own licences.