The government will set out its plans for renewal of the BBC's Royal Charter this afternoon in the House of Commons when Tessa Jowell, the beleaguered secretary for culture, media and sport, makes a statement.
The white paper will mark the start of discussions between the BBC and the government before the new licence fee is agreed in the summer.
The BBC has called for the fee to be raised to 2.3 percentage points above the rate of inflation, which could see the licence fee rise to as much as £180 in eight years' time.
However, in what will be a severe blow to the BBC, the FT says that the government has already decided the corporation will have to settle for an increase less than the rate of inflation plus 2.3 points.
The paper quoted one government source as saying that the BBC's demands for inflation-busting increases have been met with widespread scepticism.
Without the increase, the BBC will be left with a shortfall, giving it less than the £5.5bn it needs between 2007 and 2014.
Last week, industry bodies IPA and ISBA also attacked the BBC's call for a 2.3 point above-inflation licence fee increase in a submission to Jowell, saying it was excessive and will seriously damage the commercial media sector.
On April 1, the TV Licence will go up to £131.50, an above-inflation increase of 4.2%.
Mark Thompson, BBC director-general, defended that price hike saying: "The BBC will seek to ensure it makes savings, meeting the government's targets for efficiencies."
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .
_1.jpg)
.jpg)
