Television Licence Fee

HC Deb 01 December 1981 vol 14 cc139-45 3.30 pm

The Secretary of State for the Home Department Mr. William Whitelaw

With permission, Mr. Speaker, I shall make a statement about the television licence fees. As right hon. and hon. Members will be aware, the BBC has made an application for an increase in the colour television licence fee to about £50 to last for three years. In considering that application it is my duty to ensure that the corporation's home services are adequately funded, and at the same time to have regard to what is fair to the licence fee payer.

I have therefore decided, and have today laid the necessary regulations, to increase the fee for a colour television licence from £34 to £46 and for a monochrome licence from £12 to £15. The new fees come into effect at midnight tonight. It is my intention that this level of fees should last for at least three years and I shall make it clear to the BBC that I shall expect it to pay off its current deficit and live within the revenue that these new levels of fees will produce until the end of the 1984–85 financial year.

My purpose in deciding on an increase to last for at least three years is to make the licence fee system work as it should. It is also my aim to fix the level of fees for a period that will enable the corporation to plan ahead more effectively. A three-year increase will require considerable financial discipline on the part of the corporation, and the extent to which it will be able to pursue its plans for new or improved services will depend crucially on its ability to keep down its costs, particularly labour costs.

In that context, the board of governors has announced that it has commissioned a wide-ranging review of the systems by which the BBC monitors its efficiency. I welcome that decision, which indicates how seriously the board of governors takes its responsibility for ensuring that the licence fee paying public get an efficient service and value for money.

I recognise that it is not easy for some people to find the licence fee in a single lump sum each year. I therefore intend to provide a range of means to enable members of the public who wish to do so to spread the cost of the licence fee over the year. To supplement the successful and widely used television saving stamps scheme, I have approved plans for the introduction of payments by instalments. We propose, during next summer, to start accepting monthly instalments towards the following year's licence fee by means of direct debit from bank accounts, and to introduce at least a pilot scheme for payment by credit cards. That will be followed, I hope by the summer of 1983, by a scheme for the payment of monthly cash instalments over post office counters towards the following year's fee.

I believe that the three-year increases that I have announced today, coupled with greater flexibility in the methods of payment, will do much to strengthen the licence fee system and preserve the independence of the BBC.

Mr. Roy Hattersley (Birmingham, Sparkbrook)

Is the Home Secretary aware that Opposition Members believe that the BBC should be financed in a way that both preserves its independence and enables it to maintain the high level of its programmes? I therefore accept that an income of the sort that the Government propose is necessary, and that it should be obtained by means of a licence fee. However, is the right hon. Gentleman equally aware that a television licence fee of £46 will bear heavily on some members of the public, particularly retirement pensioners? The fact that the increase will be reflected in the retail price index is no comfort because, at best, the pension will be adjusted next November to compensate for tonight's new licence level and, at worst, next year's pension increase, like this year's, will not reflect the full change in the cost of living. Nor will the variety of easy payment schemes be of much benefit to most pensioners, few of whom—whatever may be said to the contrary—will ever possess credit cards, and all of whom will be required to pay instalments on next year's licence fee this year, in advance of receipt of programmes.

Therefore, I repeat to the right hon. Gentleman what my hon. Friend the Member for Halifax (Dr. Summerskill) said in the summer, that we shall not support the proposed increase unless a concession is made for retirement pensioners and the chronically sick.

May I suggest one means of raising compensating revenue for that purpose? Is it not absurd that the Savoy Hotel, for example, with hundreds of television sets used for commercial purposes, should pay the same licence fee as a single pensioner? Should there not therefore be a separate and higher commercial fee, separate from and higher than the domestic licence? Should it not be levied on every set in commercial use?

Mr. Whitelaw

I am glad to hear the right hon. Gentleman accept that the licence fee is the best method of financing the BBC. I am also glad to hear him say that the sort of income that I have designed through the licence fee is what he believes to be correct for the BBC over the next three years.

I accept that the problems of pensioners cause considerable anxiety. The easy payment schemes that I have proposed to introduce supplement the television stamps, which are available to pensioners and are helpful. A large proportion of television licences are now taken out by that method, which shows that it is valuable and worth while.

I accept that there is a problem with hotels. We set up a working party on the matter, which recommended that hotels should pay more. I am prepared to consider how best we should implement that proposal.

Mr. Peter Emery (Honiton)

Does not my right hon. Friend accept that a 36 per cent. increase in the licence fee is steep but that people will accept it on the understanding that it is essential to keep the BBC independent of any political pressure? Therefore, will my right hon. Friend also ask the BBC to look particularly at those small areas of the country where reception is very bad? There are areas that have been promised improvements in their reception for five and six years—places in Devon where hills and coombs make ordinary reception difficult? That promise by the BBC has not been fulfilled. Is my right hon. Friend aware that people in those areas will find it unpleasant to have to meet this increase when they have had no improvements in reception over the last five years?

Mr. Whitelaw

On my hon. Friend's first point, it is fair to say that the proposal for an increase in the licence fee is to last for three years. It is important for the House and the country to appreciate that under the arrangement there will be no increase in the licence fees for three years from now.

I am acutely aware of the difficulties of reception in some areas, because my constituency has some of the same problems as my hon. Friend's constituency. The BBC appreciates that, and it will do its best to remedy the problems as soon as possible.

Mr. A. J. Beith (Berwick-upon-Tweed)

Is it not a fact that pensioners' money goes into Government bank accounts a year before it is needed? In other words, why can we not have a scheme whereby instalments are paid towards the current year's licence fee to help pensioners with the cost? If, as I agree with the Home Secretary, it is desirable to give the BBC three years' freedom from having to come back to the Government, will not the Government have to do better in controlling inflation than they have done so far in order for the scheme to work?

Mr. Whitelaw

In fixing the licence fee it was important to decide on many different assumptions. That has been done, and I have come to the conclusion that the figure which I have produced, which has not been disputed, meets the requirement of being fair to the BBC as it produces its programmes and at the same time is fair to those who pay the licence fees. I thought that I had produced many proposals to help pensioners. I shall be prepared to consider any others that fall within the instalment principle to which reference has been made.

Mr. Jack Ashley (Stoke-on-Trent, South)

Will the Home Secretary consider allocating a small proportion of the licence fee specifically for the subtitling of television programmes for the deaf? I have a special interest. Will he congratulate the BBC on the splendid work that it has done so far in subtitling programmes? Is he aware that far more subtitling would be appreciated by the deaf on the part of the BBC and that the IBA should do much more as well?

Mr. Whitelaw

I am grateful to the right hon. Gentleman. I will pass on what he has said to the BBC. I believe that it has made considerable efforts on behalf of the deaf. I know that it wishes to go further and that it will seek to do so. I will pass on also the right hon. Gentleman's views to the IBA, which I have no doubt it will convey to the television companies.

Mr. Patrick Cormack (Staffordshire, South-West)

Does my right hon. Friend accept that there would be enormous support in the country for a concessionary scheme for pensioners even if that meant the rest of us having to pay slightly more than £46?

Mr. Whitelaw

I entirely accept what my hon. Friend has said, but he must appreciate some of the problems involved. If we were to give a concession to pensioner households, which would mean any household of which a retirement pensioner was a member, the colour television licence fee would have to rise to £70 for those who paid it in full and the monochrome licence fee would have to be increased to £25. Such a scheme would help many households in which the pensioner members are not especially those whom the House would wish to help, including the Leader of the Opposition and, during the currency of the increased licence fee, myself.

Mr. Derek Foster (Bishop Auckland)

Is the right hon. Gentleman aware that his statement will be greeted with widespread dismay by pensioners throughout the North of England? Does he realise that the swingeing increase will put television out of their reach? When will he come forward—[Interruption.] I know that Conservative Members have no sympathy for pensioners. That is well understood. When will the right hon. Gentleman introduce a realistic concessionary scheme for all pensioners? It is pathetic to suggest, as the right hon. Gentleman did, that there is only one conceivable scheme. When will he provide a proper concession for pensioners?

Mr. Whitelaw

First, I do not accept what the hon. Gentleman says. Secondly, my right hon. and hon. Friends have made it clear that we believe it right to provide help for pensioners through the retirement pension and not through benefits in kind. [Interruption.] Before Labour Members shout about that, I stress that the Government have honoured their pledge in full, and more, to ensure that pensioners are safeguarded against increases in the cost of living. Pensions have risen faster and further than the increase in the cost of living.

Mr. George Foulkes (South Ayrshire)

That is not true.

Mr. Whitelaw

Yes, they most certainly have risen as I have described. What is more, the television licence fee is taken into account in the retail price index.

Several Hon. Members

rose—

Mr. Speaker

Order. I propose to call five more hon. Members from either side of the House. That will be a good run before we turn to the next statement.

Mr. John Spence (Thirsk and Malton)

May I draw my right hon. Friend's attention to the renewal of the BBC's capital equipment? I should like to know how much is included in the increase that he has awarded the BBC for that renewal as opposed to how much the BBC requested.

Mr. Whitelaw

The discussions about the level of the fee covered all these issues. A decision was made on the basis of all the considerations which were put before us and discussed with the BBC. I do not wish to single out any one consideration.

Mr. Bob Cryer (Keighley)

Does the right hon. Gentleman realise that the Government have cut the link between pensions and wages that the previous Labour Government established by law, and that pensioners are facing enormous difficulties? Does he understand that television is one means by which many pensioners keep in contact with the world? Surely he could and should consider a scheme for some modest flat rate charge to all pensioners to give them at least some compensation for the attack that the Government have made on pensioners as a whole?

Mr. Whitelaw

When the previous Labour Government were in office they never thought to introduce such a concession. They came to it in opposition. They did not implement the policy when they were in government. The hon. Gentleman must appreciate that what I said about pensions having risen more than the increase in the cost of living is true and cannot be disputed statistically. That is something that he will have to accept.

Mr. Charles Morrison (Devizes)

May I emphasise the point made by the right hon. Member for Stoke-on-Trent, South (Mr. Ashley)? Is my right hon. Friend aware that there are more deaf people in the United Kingdom than there are Welsh people? Does he agree that even greater special regard should be given to the needs of the deaf?

Mr. Whitelaw

I am grateful to my hon. Friend. It is true that the BBC has gone a long way to deal with the problems of the deaf. I hope that it will be able to go further. The licence fee was determined in consideration of what the BBC will be able to do in Wales with the Welsh programmes, which is an important issue. I take my hon. Friend's point about the deaf.

Mr. Barry Sheerman (Huddersfield, East)

Is the right hon. Gentleman aware that many people feel that he has missed the opportunity to take the BBC licence fee out of the political arena and that we shall see yet again the political intimidation of the BBC as we come, at the end of the three-year period that he has announced, to a general election? Is he aware that many Opposition Members believe that special arrangements should be made to improve the quality of service that is provided by the BBC for old-age pensioners? The increased licence fee should have been even higher and should have been linked to inflation.

Mr. Whitelaw

By establishing a clear position for the BBC for three years ahead the Government are surely doing exactly the opposite of what the hon. Gentleman said. Surely such action underlines the independence of the BBC, which is crucial. That is why I attached so much importance to fixing a licence fee for three years. On the hon. Gentleman's second question about pensioners, I have made clear my position and I wish to stand by it.

Mr. Paul Dean (Somerset, North)

Does my right hon. Friend agree that every increase in the licence fee, whether it is introduced by a Labour Government or a Conservative Government, increases the difficulties for pensioners and others on modest incomes? In view of that, will he give urgent attention to the many anomalies which exist within the licence arrangements and to the possibility of alternative sources of revenue for the BBC?

Mr. Whitelaw

My hon. Friend has long campaigned for pensioners and I applaud his efforts in so doing. I appreciate the difficulties that ensue from increasing the licence fee on the scale that I have announced, but I contend that the increases are fair to the BBC and to the country. We still have one of the lowest licence fees in Europe. That is important to accept. I accept that there are anomalies in the system. I do not wish to overcome those by taking away some of the concessions that are already made. That would be harsh and unreasonable. I shall consider the anomalies to which my hon. Friend has referred.

Mr. Edward Lyons (Bradford, West)

I appreciate the need for the BBC's profits to be funded, but will the right hon. Gentleman bear in mind the fact that an extra £1 a month in instalments for a retirement pensioner is an enormous extra impost? Secondly, as black and white television sets are largely in the hands of the poorest sections of the population, will the right hon. Gentleman at least freeze the fee for black and white sets instead of increasing it?

Mr. Whitelaw

I accept what the hon. and learned Gentleman says as being one of the anxieties of announcing any increase in this field. The increase in the fee for a monochrome set would be regarded as reasonable in the circumstances.

Mr. John Gorst (Hendon, North)

Would my right hon. Friend clarify the position about the people whose licences expired on 30 November and who have already paid the old rate? Will they be required to pay a supplement on it or will they be allowed to keep their new licences at the old rate?

Mr. Whitelaw

What I have said about the new fees comes into effect at midnight tonight. If anyone has paid before midnight, he gets his licence at the old fee and not the new one.

Mr. Ian Mikardo (Bethnal Green and Bow)

Is the right hon. Gentleman aware that one of the concessions he has offered today will be warmly welcomed by all the pensioners in East London who have Diners Club credit cards?

Mr. Whitelaw

The hon. Gentleman enjoys such snide remarks, but there are many, other than pensioners, who may wish to pay fees in that way. It is perfectly sensible to provide a variety of ways of paying the licence fee. I do not see why that should be the occasion for snide remarks.

Mr. Nicholas Winterton (Macclesfield)

I direct my right hon. Friend's attention to the anomaly to which my hon. Friend referred—the concession now available to pensioners who live in warden-supervised accommodation. Is the Minister aware that many pensioners who do not have that advantage are often worse off financially than those who live in that accommodation and that they find the anomaly annoying and frustrating?

Would the Minister not consider removing the anomaly by raising the fee to all old-age pensioners but by less than the figure which he has announced to the House today, and funding it by the sort of proposal put by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley)—by increasing the charges to hotels and other commercial institutions?

Mr. Whitelaw

First, in answer to the right hon. Gentleman, I will certainly consider the position about hotels and see what further revenue we might get there. I am certainly prepared to consider that, but I must make it clear to my hon. Friend that any revenue from that source, if we decided to go forward with it, would certainly not meet the sort of increase he has suggested on the other front.

I accept that anomalies exist but I would not wish to remove them by taking something from people who already have it. That would be a very harsh decision.

Mr. Joseph Ashton (Bassetlaw)

I discern from the mood of the House that there is now a great desire that television should be treated as a social service. Would it not be much simpler to collect the licence fee by adding £1 a week to the National Health stamp so that everybody who worked paid and so that when we all retire or are off work we get the concession?

Mr. Whitelaw

The simple answer to that is "No, Sir."

Mr. Hattersley

Since the Home Secretary has shown some sympathy for the idea of a commercial fee, which has been pressed on him from both sides of the House, does he propose to make a further statement about his examination before he lays the order, or does he expect hon. Members to vote on the present pattern and hear his views afterwards?

Mr. Whitelaw

Because I have to study the views of the working party on hotels, which could not possibly affect the broad basis of the decision I have taken today, I would ask the right hon. Gentleman and the House to approve the situation as it stands.

Mr. Speaker

Mr. Secretary Howell: statement.

Mr. Andrew Faulds (Warley, East)

On a point of order, Mr. Speaker. By, I am sure, a momentary oversight, you have forgotten that I have spoken on these matters from the Front Bench. I might have had a fairly valuable contribution to make—[Interruption.]

Mr. Speaker

Order. As usual, I am much obliged to the hon. Gentleman. He has given me the opportunity to say that I do my very best to ensure that those on the Front Bench who run back up to the Back Benches, are not given the same preference as real Back Benchers. I think that is fair and I am quite sure that the hon. Gentleman's sense of fair play will lead him to agree with me.

Mr. Faulds

I am happy to yield to your suggestion, Mr. Speaker, because we are about to have the happy introduction of moderation, reason and true feminity in contrast to the tough aclamantine type that we usually have to suffer.

Mr. Speaker

We shall have the statement first. Mr. Secretary Howell—

Mr. Kenneth Lewis (Rutland and Stamford)

On a point of order, Mr. Speaker. I simply draw your attention to the fact that some hon. Members, who are not in the happy position of being able to go from the Front Bench to the Back Benches, have difficulties in being called—never mind the hon. Member for Warley, East (Mr. Faulds).

Later—

Mr. Peter Snape (West Bromwich, East)

Without repeating the point of order raised by my hon. Friend the Member for Warley, East (Mr. Faulds), may I ask you, Mr. Speaker, how you decide which Front Bench spokesmen can be called to speak from the Back Benches? Are all Front Bench spokesmen equal? Some of us regard the matter that has just been discussed as at least as important as Front Bench responsibilities.

Mr. Speaker

I believe that I called one of the hon. Gentleman's colleagues who is a member of his union, if that is what is worrying him. Otherwise, I am not anxious to make a firm rule that no one who speaks from the Front Bench can ever be called when he is on the Back Benches. If it were the will of the House, of course, I would respond to it, but I have not yet had any indication of that.