UPDATED | Proposals to introduce subscriptions or allow advertising are once again under consideration as ministers revisit the future of BBC funding.
Culture Secretary Lisa Nandy has set out a range of options aimed at diversifying the broadcaster’s income streams. The move comes amid growing concern over the rising number of viewers choosing not to pay the licence fee.
While the licence fee is likely to remain in place, it could play a diminished role in the BBC’s overall finances. According to The Times, ministers are “keen for the broadcaster to reduce the proportion of money paid by licence fee payers.”
What might this mean for viewers?
Exact details will become clearer once the consultation paper is published.
However, options could include a freeze or reduction in the current licence fee. The BBC would then have to ‘top-up’ their income, for example by creating a paywall for some content or by carrying adverts.
Alternatively, the current licence fee model could remain, but with different tiers based on the wealth of a household. This might be controversial if pegged to council tax bands. Council tax bands aren’t a strict indicator of wealth and are subject to regional anomalies in England, where council tax is based on how much a house would have been worth in 1991.
Ministers also want the BBC to grow its income from its commercial arm BBC Studios. Just over a third of the BBC’s total income last year came from BBC Studios.
Do I have a say?
The public consultation on the future of the BBC is live until 23:59 GMT on Tuesday 10 March 2026.
You can read the associated documents on gov.uk.
The consultation form is available online only.
Following the conclusion of the review and consultation, a draft of the new Charter will then be published and debated in Parliament. The Charter Review will complete with the granting of a new Charter for the BBC from 2028.
What’s the BBC’s likely response?
The BBC is understood to prefer the retention of the licence fee. It has previously voiced its opposition to carrying advertising or putting content behind a paywall. Charging some users more for the BBC is something that has its backers within the BBC.
Commercial broadcasters are unsurprisingly expected to strongly object to an ad-funded BBC.
Two-tier BBC already exists in theory
BBC Studios already operates a number of subscription and ad-funded services in the UK via its subsidiary UKTV.
UKTV operates pay TV channels U&Gold and U&Alibi and ad-funded streaming service “U”.
There is currently a rule that stops the BBC from using its own branding on ad-funded and pay TV services in the UK. Channels very similar to UKTV’s British services operate outside the UK with BBC branding.
If the outcome of the consultation was to change the way the BBC is funded, the separation between public service BBC and commercial UKTV would be undermined.
By: Marc Thornham | Updated 16/12/2025 with a section containing details of the consultation, which went live today.