Debate on BBC’s future kick-started by government consultation

The government will consider new ways of funding the BBC, including advertising and a subscription model, as it formally begins the process which will decide the corporation’s future.

It has published a consultation document – or green paper – laying out plans to future-proof the BBC, put it on a sustainable financial footing and bolster trust.

The government will ask the public for their views about several funding options – including the possibility of allowing adverts on the BBC, which could be broadcast on live TV and radio, or on iPlayer and the BBC website.

Another option being considered is a “top-up subscription service”, which would offer premium content.

In the green paper, the government says it is “keeping an open mind about the future of BBC funding”, adding: “We have not yet identified a preferred model.

“We are therefore consulting on a number of options to help determine the optimal approach.”

The current licence fee, which costs £174.50 annually, could also be replaced with a different set of rates depending on which of the broadcaster’s services people use.

The discussions begin the renewal of the BBC charter – the corporation’s rulebook and licence to exist – which expires in 2027.

Culture Secretary Nandy said the government was “keeping all options open”, but noted it had ruled out general taxation.

“That is because it is essential that the BBC can hold governments of any persuasion to account, including ours, without fear or favour and without being heavily reliant on direct funding from government,” she said.

Nandy described the BBC as “an institution that matters deeply to the democratic process in this country and to the health of our nation” and said it “has to have sustainable funding in order to thrive”.

In the consultation, the government asks the public what level of advertising they would be comfortable with on BBC platforms.

The options include extensive advertising, which would see the BBC carry adverts on all of its content and services, a more limited advertising model, which would see adverts permitted on some online content and services, but not live TV or radio, or no advertising whatsoever.

The government told journalists on Tuesday: “The BBC could potentially generate significant revenue from carrying advertising on its public services, while continuing to make them universally available.

“This funding model supports other public service media providers such as ITV, Channel 4, and Channel 5.”

If advertising is allowed, it would mark the first time adverts would be shown on BBC platforms in the corporation’s 100-year history.

The consultation also asks about various forms of a subscription model, which would see the BBC offer users additional services for a certain cost on top of the licence fee.

The public are asked how strongly they agree or disagree that they would be willing to pay for “a top-up subscription service for premium and entertainment content”.

The government state in the green paper: “We have not ruled out keeping the current licence fee in place with its current structure.

“However, given the sustainability challenges it is facing, we are also reviewing the scope of services for which the licence fee is required and considering differential rates for specific types of users, to make it more sustainable for the long-term, along with increasing commercial revenue to ease the burden on the public.”

Former BBC controller of editorial policy, Richard Ayre, described the consultation as “the most encouraging start of a charter process in decades, with the government apparently committed to giving the BBC a sustained and financially sustainable future”.

The licence fee brought in £3.8 billion last year. Although other funding streams are on the table for now, many media commentators expect the licence fee to remain, with some changes.

Nandy said the BBC was “fundamental to the health of our nation and we want to make sure that we put it on a firm footing for decades to come”.

But she also acknowledged recent issues at the corporation: “There have been serious concerns about developments at the BBC, including editorial standards and about political interference.

“These aren’t new challenges for the BBC. Throughout its history it’s had to navigate them, but we believe that through this charter we can strengthen the amount of accountability within the BBC.”

Outgoing BBC director general Tim Davie said in a statement: “We welcome the publication of the government’s green paper and the start of the public consultation on the future of the BBC. We urge everyone who cares about the success of the UK’s world-leading creative industries to have their say.

“At the BBC, we want change, so we can continue to deliver for the UK for generations to come. We want to secure a public service BBC that is independent, sustainably funded for the long term, and meets our audience’s needs.”

Former BBC director general Tony Hall suggested there should be careful consideration of a household tax charged in line with council tax bands.

The government rejects that model. It does, however, accept that public funding of the BBC will remain in some form and Lord Hall suggests an independent body, like a pay review body, to “take the politics out of the licence fee debate”.

“Give them the task every three years of reviewing whether the money the BBC has got matches our ambitions for the BBC,” he said.

He agrees the licence fee needs to be reformed and made “fairer”.

The Reform party wants to scrap the licence fee altogether, while Conservative leader, Kemi Badenoch, threatened to withdraw support for it earlier this year.

The Liberal Democrats are supportive of the licence fee up until 2027. The Green Party did not specifically mention the BBC in its 2024 manifesto.

The consultation will also look at numerous other issues including how the World Service should be funded, the corporation’s workplace culture, efficiency, transparency and accountability and the possibility of carrying advertising on the BBC.

It also wants to tackle how the BBC can survive and thrive in the streaming era.

Additionally, the government is seeking views on how to ensure the BBC commands the public’s trust, is accountable to audiences and fully represents communities.

This includes potentially giving the corporation new responsibilities to counter misinformation and disinformation, updating the BBC’s mission to put accuracy on the same footing as impartiality, and strengthening the BBC’s independence, including examining political appointments to the BBC’s board.

Labour MPs raised concerns around this issue in Parliament after the recent BBC controversy over the misleading edit of a Donald Trump speech on a Panorama prompted the resignations of the BBC director general and the CEO of News.

Trump is now suing the BBC for defamation over the edit.

It’s one of a series of controversies the BBC has faced in recent months for which it has had to apologise.

These include a documentary about children in Gaza that had to be taken down from BBC iPlayer after it emerged the child narrator was the son of a Hamas official and the failure immediately to remove the punk duo Bob Vylan’s set from a Glastonbury live stream after offensive comments were made on stage.

The consultation will be open for 12 weeks from 16 December 2025 to 10 March 2026.

Next year, following the consultation, the government will publish its own vision for the BBC.

Additional reporting by Steven McIntosh and Emma Saunders.