levo

Radio

Funding radio: the licence fee, advertising and sponsorship

  • 3 things to know
  • Component 1

Overview

Approximate annual cost of a television licence in recent years, spot advertising in radio and sponsorship as a radio revenue stream.

What you need to know

Answer each one before you reveal it.

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Numbers

Explain how BBC radio is paid for and who sets the amount.

Key term

How is BBC radio funded?

Key term

Who sets the level of the licence fee?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    How is BBC radio funded?

    Model answer

    BBC radio is funded from the television licence fee paid by United Kingdom households. Domestic BBC radio services carry no advertising at all.

  2. 2

    Who sets the level of the licence fee?

    Model answer

    The government sets the level of the licence fee after negotiation with the BBC. Parliament ultimately approves the settlement.

  3. 3

    State the approximate annual cost of a television licence in recent years.

    Model answer

    The annual licence fee stood at £169.50 from April 2024, rose to £174.50 from April 2025 and to £180 from April 2026.

  4. 4

    Give two criticisms of the licence fee as a funding model.

    Model answer

    Critics call the licence fee regressive, since every household pays the same regardless of income. Others object that people who never use BBC output must still pay.

  5. 5

    Give two arguments in favour of the licence fee.

    Model answer

    The licence fee gives the BBC independence from advertisers and from shareholders. Guaranteed income also allows long-term investment in unprofitable output.

  6. 6

    What changed for over-75s licences in 2020?

    Model answer

    Free licences for over-75s were restricted in 2020 to households receiving Pension Credit. The BBC absorbed the cost after government funding for the concession ended.

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AWoman's Hour began on the BBC Light Programme in 1946.
BThe Light Programme became Radio 2 in 1967.
CThe programme moved to Radio 4 in 1973.

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