Financial Information

How is TV Licensing funded and what is the cost of collecting the TV Licence fee?

The revenue source for TV Licensing is the TV Licence fee settlement by the Government to the BBC. More information on this is contained in the BBC Annual Report and Accounts and in the TV Licensing Annual Reviews.

The TV Licensing Costs of Collection chart, below, sets out the total licence fee revenue collected and collection costs over the last nine financial years.

Section 365 of the Communications Act 2003 (opens in a new window) requires the BBC to pay all licence fee revenue it collects (via TV Licensing), less any sums required for making refunds, into the Government’s Consolidated Fund. TV Licensing doesn’t retain any of the licence fee revenue it collects; all monies are passed to the Government, and then on to the BBC, less a small administration fee paid to the Department for Digital, Culture, Media and Sport (opens in a new window).

The Secretary of State for Digital, Culture, Media and Sport may retain a proportion of the licence fee revenue for other purposes (refer to the BBC’s Royal Charter and Agreement with Secretary of State).

TV Licensing costs of collection 2015-2017

  2016/17 2015/16
  £ million % of costs £ million % of costs
Collection
costs**
46.2 56.3 83.8 73.1
Depreciation
of new
systems
1.8 2.2 1.6 1.4
Comms*** 14.9 18.1 15.8 13.8
Postage 13.6 16.5 10.3 9.0
Admin and
contract
management
2.0 2.4 3.1 2.7
Licence Fee Modernisation 3.7 4.5    
Total £82.2 £114.6
Licence fee
revenue
3,787.2 3,742.7
Costs as %
of revenue
 2.2%   3.1% 
Licences in force
(exc ARC)
25.826 25.558

Per TV Licence 2015-2017:

  2016/17 2015/16
Cost per licence £3.18 £4.49
Cost per licence as % of licence fee* 2.2% 3.1%
Collection costs** £1.79 £3.28
Depreciation of new systems £0.07 £0.06
Comms*** £0.58 £0.62
Postage £0.53 £0.40
Admin and contract management £0.08 £0.12
Licence Fee Modernisation £0.14  
Total £3.18 £4.49

* TV Licensing collected around £3.8billion in revenue in 2016/17, an increase of £44million on the previous year. Collection costs were around £82million (£82.2m) including accounting adjustments which had the effect of reducing the reported collection costs by £19.8million. This is under 3p for every £1 collected.

** Collection costs include call centres, field force, detection and over the counters services (net of recharges re over 75s).

*** Communications including reminders and information campaigns.

Further breakdown of the specific services within the collection contracts is not readily available as the fee structure for our main contractor Capita is based on revenue collected and encompasses all aspects of the service provision across the call centres and the field operations.

The cost per licence reflects the average cost, per licence depending on the level of enforcement required.

Fines collected for licence fee evasion are not given to the BBC or TV Licensing - they are a matter for the courts.

TV Licensing costs of collection 2008-2015
  2014/15 2013/14 2012/13 2011/12 2010/11 2009/10 2008/09
  £ million % of costs £ million % of costs £ million % of costs £ million % of costs £ million % of costs £ million % of costs £ million % of costs
Collection
costs**
71.7 70.7 71.6 70.1 83.0 74.5 95.0 75.3 92.7 74.5 93.8 74.3 88.4 73.7
Depreciation
of new
systems
2.2 2.2 2.1 2.1 2.1 1.9 2.5 2.0 2.5 2.01 2.2 1.7 1.1 0.9
Comms*** 14.1 13.9 15.5 15.2 14.0 12.6 13.9 11.0 16.6 13.34 18.0 14.3 22.3 18.6
Postage 10.8 10.7 10.8 10.6 12.2 11.0 9.5 7.5 8.7 6.99 8.4 6.7 7.1 5.9
Admin and
contract
management
2.6 2.6 2.2 2.2 0.1 0.1 5.2 4.1 3.9 3.14 3.8 3.0 1.0 0.8
Total £101.4 £102.2 £111.4 £126.1 £124.4 £126.2 £119.9
Licence fee revenue 3,735 3,722 3,705.7 3,697.8 3,678.6 3,578.8 3,493.8
Costs as % of
revenue
2.7% 2.7% 3.0% 3.4% 3.4% 3.5% 3.4%
Licences in force
(exc ARC)
25.508 25.419 25.338 25.226 25.103 24.964 24.872

Per TV Licence 2008-2015:

  2014/15 2013/14 2012/13 2011/12 2010/11 2009/10 2008/09
Cost per licence £3.98 £4.02 £4.40 £5.00 £4.95 £5.06 £4.92
Cost per licence as % of licence fee* 2.7% 2.8% 3.0% 3.4% 3.4% 3.5% 3.5%
Collection costs** £2.81 £2.82 £3.28 £3.77 £3.69 £3.76 £3.55
Depreciation of new systems £0.09 £0.08 £0.08 £0.10 £0.10 £0.09 £0.04
Comms*** £0.55 £0.61 £0.55 £0.55 £0.66 £0.72 £0.90
Postage £0.42 £0.42 £0.48 £0.38 £0.35 £0.34 £0.29
Admin and contract management £0.10 £0.09 £0.00 £0.21 £0.15 £0.15 £0.04
Total £3.98 £4.02 £4.40 £5.00 £4.95 £5.06 £4.82
What portion of the licence fee revenue is spent on collection costs?

The cost of collection has decreased from £114.6m in 2015/16 to £88.2m in 2016/17. This represents 2.2% of the total licence fee revenue collected (£3.8 billion) in 2016/17. As shown in the TV Licensing Costs of Collection chart above, the costs of collection covers call centres, field force, detection and over the counter services, communications including reminders and information campaigns, postage and administration and contract management.

How much in licence fees do you collect from [X] location?

Figures on licence fee revenue by area aren’t available, as it isn’t necessary to generate this type of information for the purpose of issuing licences, and licence fee collection and enforcement. Please see the About TV Licensing section for information on licence fee revenue.

How much TV Licence fee revenue is collected from areas such as Scotland, Wales, North East England, Isle of Man, Jersey, and Guernsey?

The BBC doesn’t collate information on licence fee revenue by location. For the purposes of administering the television licensing system, licence fee revenue is not configured by geographical location, as the BBC has no reason for doing this. The total licence fee revenue collected from 2007/08 to 2016/17 is detailed in the TV Licensing Costs of Collection chart above.

Further information is published in the BBC’s Annual Report and Accounts. The latest Annual Report (2016-17) is available on the BBC website at - www.bbc.co.uk/annualreport.

How much does TV Licensing spend on advertising? How much is spent on specific campaigns e.g. online advertisements?

For the 2016/17 financial year (the latest figures available) £14.9 million was spent on communications, including reminders and information campaigns. The TV Licensing Costs of Collection chart, at the top of this page, contains a break-down of TV Licensing’s top-line costs over the last seven financial years.

Specific advertising costs (including the cost of production and airtime to broadcast trails) is exempt from disclosure under section 43(2) of the FOI Act.

Note: The BBC does not advertise the need to be licensed, the ways to pay and the consequences of non-payment on commercial TV stations. TV trails are shown on BBC channels. Communications shown on BBC channels are referred to as ‘trails’ because the BBC, as a public service broadcaster, does not raise revenue through advertising.

What was TV Licensing’s budget for 2016/17 how does it compare to expenditure over the previous ten years?

TV Licensing’s budgeted and actual costs for the last ten financial years are shown in this chart:

  2016/17 2015/16 2014/15 2013/14 2012/13 2011/12 2010/11
Budgeted (£ million) 98.5 101.3 105.8 106.6 123.9 126.5 124.8
Actual (£ million) 82.2 114.6 101.4 102.1 111.4 126.1 124.4
  2009/10 2008/09 2007/08
Budgeted (£ million) 130.4 128.6 134.1
Actual (£ million) 126.2 119.9 121.6
Are the expenses and pensions of staff engaged by TV Licensing agents paid from the TV Licence fee?

‘TV Licensing’ is a trade mark of the BBC and is used under licence by companies contracted by the BBC to administer the collection of television licence fees and enforcement of the television licensing system.

The BBC does not hold the information requested here. It is a matter for each agent to determine how it chooses to spend the money it receives by way of remuneration from the BBC. Any information that a contractor holds in this regard is not held by them on behalf of the BBC and is therefore exempt from disclosure under section 3(2) of the FOI Act.

Who audits TV Licensing?

The National Audit Office (NAO). They review statements from TV Licensing contractors as part of annual independent audits of the BBC.

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Latest press releases

TV Licensing: New interactive map tackles embarrassment around debt advice
Thu May 24 2018
Embarrassment is a key factor preventing people in financial difficulty asking for help, research has revealed. Being unaware of the help available also contributes to delays in seeking advice.
Problems paying your TV Licence? There's help at hand
Tue Apr 17 2018
TV Licensing is encouraging people in financial difficulties to ask for help if they are struggling to pay for a TV Licence.
New TV Licensing flexible payment plan launched
Mon Apr 09 2018
Since 1 April 2018, the BBC is trialling a new simpler payment plan for the licence fee. The government changed the rules on 9 March 2018 allowing the BBC to introduce this pilot scheme to help people who are struggling to pay or to keep up with payments.

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