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The BBC licence fee is under consideration to be scrapped as Labour officials have planned to replace it with a general tax.
Lisa Nandy, Culture Secretary, is contemplating abolishing the fee in December 2027 – when the current agreement between the broadcaster and the Government, known as the Royal Charter, ends.
The Government could instead opt for a system that would see the Government collect taxes to bankroll TV programmes instead.
New plans are said to include turning the corporation into a mutual organisation owned by the public.
This would mean that the Government would no longer be able to prosecute those who do not pay.
The potential plans have followed Nandy’s previous commitment to hold an “honest national conversation about the broadcaster’s long-term future”.
While finalised decisions have not been reached as of yet, Whitehall sources have indicated that the minister believes the licence fee must be scrapped.
One source told the Sunday Times: “Lisa does not believe that the licence fee is financially sustainable.
“But she believes that our national broadcaster should be owned by the nation.
“The money would go in from taxes but citizens would own it and be involved in decisions about its strategic direction.”
In April, the annual fee is increasing by £5, approved by the Government to match inflation.
Last year, the BBC published its financial results which revealed it had suffered from an £80 million drop in licence fee revenues.
Half a million households cancelled their TV licence fee in 2023 alone, with British viewers turning away from terrestrial channels in favour of subscriptions like Netflix, Disney+, Prime Video, and Apple TV+.Reports last night have suggested that Nandy had briefed the PM on her draft plans, while Starmer is eager to solve the long-lasting issue regarding how to pay for BBC shows.
The Whitehall source added: “People have been saying for more than a decade now that the licence fee is an anachronism. But then they keep going back to it.
“Keir is prepared to think more radically.”
Labour’s review of the corporation’s charter will launch this year, with Nandy and BBC’s director general already kickstarting “embryonic talks” at the end of 2024.