Monday, August 24, 2015

A tenner ?

The Telegraph says BBC execs heading to the Edinburgh TV Festival later this week have a briefing document from Price Waterhouse Cooper, to help them pepper their platform performances with financial factoids.

PWC have apparently calculated that every £1 of licence fee investment "leads to an additional or net increase of 60p in GDP/ economic value". So, a 25 per cent cut in the licence fee over the next five years would cut GDP by £630 million and lead to 32,000 job losses. Conversely, a 15 per cent increase in the licence fee over five years would boost GDP by £319m and create 16,200 jobs.

These various percentages are presumably not selected randomly. In theory, the licence fee is set to rise with CPI for the next five years, as part of the Osborne deal, subject, apparently, to Charter decisions on the BBC's scope. Thus the 25% scare figure.

At the upper end, guessing CPI at a crude 2% p.a. over five years from 2017, the 15% rise figure suggests the BBC may be seeking a licence fee that starts the five years at around £155.

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