The Department for Culture, Media and Sport (DCMS) has revealed that the annual BBC TV licence fee will increase by £5.50, bringing it to £180. This adjustment aims to ensure the BBC remains financially stable.

This fee hike is likely to add pressure on households already grappling with climbing living costs. The increase comes despite previous assurances that the licence fee would remain under £175, based on an agreement between the BBC and the former government.

Back in 2022, an arrangement was made to link the licence fee to inflation until at least 2027. At the time, the fee stood at £159, with expectations that it would not exceed £175 by the end of the agreement. However, unexpectedly high inflation has prompted a reassessment of this fee.

In November of last year, it was announced by the Labour Government that the fee would rise from £169.50 to £174.50 starting in April.

In 2025, the BBC generated nearly £4 billion from this levy, underscoring its significance as a revenue source for the broadcaster.

The corporation raked in almost £4billion from the levy in 2025. 

But the future of the licence fee has come under scrutiny amid a sharp decline in the number of people watching traditional TV channels as viewers continue to turn to streaming services such as Netflix and Prime Video.

The number of licences bought decreased from 24.1 million to 23.8 million in 2024/25, with the drop hitting the BBC’s income in real terms.

The BBC TV licence fee is set to rise by £5.50 to £180 a year in a bid to ‘keep the BBC on stable financial footing’, the Department for Culture, Media and Sport (DCMS) has announced

News of the price hike is set to deal a further blow to millions of households already struggling with rising costs and comes despite a deal to keep the licence below £175 a year

In a statement on Friday, DCMS described the BBC as ‘the UK’s number one media brand, with 94per cent of UK adults using the BBC each month last year.’

The broadcaster ‘remains the UK’s most widely used and trusted news outlet’, it added.

Free licences will remain for people aged over 75 on Pension Credit, with reduced fees for care home residents and blind individuals.

The department added the price hike ‘comes alongside the ongoing Charter Review, which will ensure the BBC is sustainably funded to provide value for licence fee payers, commands the public’s trust with impartial editorial standards and drives growth, opportunity and good jobs across the country.’

News of the fee change comes as BBC bosses weigh up controversial plans that would extend the licence requirement to radio channels and the broadcaster’s news website. 

Another idea being touted could involve the introduction of a model where wealthier households pay more, in turn subsidising the licence fee for lower income families. 

The Daily Mail reported in November that one in eight households now say they do not need a TV licence, leading to losses estimated at up to £550million. 

BBC bosses are lobbying for a new deal before 2027, when the royal charter that governs the broadcaster is due to renew. 

An insider previously told The Times: ‘Our priority is ensuring the BBC is sustainable as a universal public service beyond just the next few years.

‘That shouldn’t mean the price for ordinary households goes up. We’re very sensitive to that pressure.

‘Ministers have set out an ambitious agenda of what the BBC should be and we are open to all ideas that, as the consultation says, ensures the organisation ‘not just survives, but thrives’ in this competitive media landscape.’

Last year, furious Brits spoke to the Daily Mail about why they are no longer paying their licence fees amid a series of scandals at the broadcaster.

Former Tory MP and ex-BBC staffer Matthew Offord revealed that he stopped paying his licence fee after standing down from his position.

He said: ‘I stopped paying the licence fee in April, having struggled to do so for many years.

‘I concluded that I would pay it while I was an MP, but when it expired, I could not bring myself to do so. I also withdrew all my pension contributions from the scheme at the BBC.

‘The atmosphere was toxic when I was employed, but the continuing behaviour of individuals, the groupthink and the rejection of anti-Semitism in their reporting was too much for me.’

Another former BBC staffer, Robin Whelan, 53, from Surrey, also said he stopped paying the fee when he left the corporation.

He said: ‘After many years of paying as a BBC staff member, I stopped. I took stock of what I actually used the BBC for. Its website, radio and a little catch-up.’

The future of the licence fee has come under scrutiny amid a sharp decline in the number of people watching traditional TV channels as viewers.

A report by the Commons Public Accounts Committee revealed that 2.9million BBC viewers evaded paying the £174.50-a-year fee, costing the broadcaster an estimated £550million in lost income.

Meanwhile £617million was lost from 3.6million households declaring they don’t need a licence.

This is breaking news, more follows.