UK considers £11 monthly broadband levy to replace BBC TV licence

# What's happening Charter's expiry at the end of 2027. A Social Market Foundation (SMF) report published Sept. 23 recommends replacing the current TV licence fee with a new charge applied to home broadband accounts, called the Home Internet Levy.

# The SMF proposal in plain terms Under the SMF plan the annual TV licence — currently £180 per year — would be scrapped. Instead households would pay an £11 monthly surcharge on their broadband bill. For households that already pay the licence, this would reduce their annual cost to £132 instead of £180.

# Why the SMF recommends this The SMF frames the change as a response to falling licence-fee compliance and shifting viewing habits. Key points the report highlights:

• The BBC's services reach over 94% of British households.
• The SMF estimates that if the BBC were to close, the economy would lose between £4 billion and £6 billion in output and 18,000–29,000 jobs.

# Political response and alternatives under consideration Labour Party ministers and Culture Secretary Lisa Nandy have started discussing the SMF's suggestion. A Department for Digital, Culture, Media and Sport spokesperson said the BBC must have a funding model that is "sustainable and fair to all those that are paying it." No final decision has been made. Other options mentioned include:

• Keeping the licence fee and adding a small broadband levy of about £2.30 per month.
• Replacing the current system with a different funding model altogether.
• Offering discounts or exemptions for lower-income households.

# Who would be affected and why it's controversial The main controversy is the principle of attaching BBC funding to an internet connection. Critics argue that adding a broadband surcharge would require every household with an internet connection to contribute even if no one in the home watches live television or uses BBC services. There is also concern about affordability for low-income households and whether a universal broadband levy is fair in an era of streaming and diverse content consumption.

# Short-term implications If taken forward, an internet-based levy would change billing channels and potentially reduce evasion by capturing households that currently avoid the TV licence. The SMF positions the monthly charge as cheaper for licence payers, but the plan shifts the payment mechanism and raises distributional questions.

# Next steps The government will continue to review the BBC's funding options while the Royal Charter comes up for renewal. Discussions within Labour and at the Department for Digital, Culture, Media and Sport will determine whether the Home Internet Levy is advanced alongside other proposals.

# Bottom line