/ Money, Technology

Why the government’s sitting on £1bn of TV licence fees

If you’re one of the millions who pay for their TV licence by direct debit or cash payment plan, did you know you’re giving a £1bn interest-free loan to the government?

When I moved house last year, I took out a new TV licence. Moving is an expensive business, so I thought I’d spread the cost of the licence by paying by direct debit.

What I didn’t realise until then was that anyone who pays for their TV licence by monthly direct debit is charged double for the first six months. You then have to make the regular payment from month seven. This effectively means that your TV licence account is six months in credit all the time.

You don’t get this money back until you no longer have to pay for a TV licence or you switch payment method by paying your licence fee in advance. So yes, for many of us that means holding out until we turn 75 or die. Great.

£1bn of TV licence cash overpaid

I initially told myself to get over it. It’s £72.75 that I’ll get back at some point. But the thought kept festering. Why on earth should they keep my money like this? So I decided to issue a request under the Freedom of Information Act, and that’s when I discovered the sheer scale of this interest-free loan.

14.7 million households pay for their TV licence by direct debit, with a further 1.5 million paying under a ‘cash payment plan’ or ‘monthly cash plan’, whereby you pay regular payments at PayPoint outlets.

Both systems operate on the ‘six months in advance’ principle, with the money held in the government’s Consolidated Fund account, from which the BBC receives a monthly payment.

Considering this amount of TV licences, our calculations show that a massive £1bn of extra payments is earning interest in the government’s coffers.

Protecting the BBC from losses

A government spokesperson told Which? that the system provides ‘an alternative to an annual lump sum payment, while also protecting the BBC from losses incurred if payments stop before the whole amount has been collected’.

Well, I have an impeccable track record of paying my bills on time, so I don’t see why I should have to keep my account over £70 in credit just in case I default.

There are already hefty penalties in place for anyone who doesn’t have a TV licence. And there are plenty of households that could do with that £70 right now. The government shouldn’t be cross-subsidising the cost of non-payers using the money of the responsible majority who choose direct debit.


Jane is absolutely right.

After the fiasco I am having with them at the moment I wonder how many people they do this to?
I rang up last Thursday as I received a letter to say I didn’t have a TV License. Couldn’t understand it but somehow the DD had gone wrong so I said I would pay with my Debit Card for this month and sort the DD out with the Bank.

The person on the phone whose name I have took the whole amount as I was speaking to him about paying this month with my Debit Card and sorting out the DD. He had no authority to do this. I did not authorise it. I am now so annoyed as they said they would listen to the recording of the call (which I was pleased about) and ring me back last Friday to let me know if they were sending me a cheque for the full amount and then I would resume paying from July by DD. Guess what? No call. And they have also put a DD on my bank account.

How good is that? They have taken the full amount. Don’t know if they are sending it back to me?
If I leave the DD on my Account they will take that as well. I will try again to get some sense out of them in my Lunch Break.

I wish no one would pay for the License !!!!!!!!!!!!!!!!!!!!!!!!!

What would happen then. Think they would have to rethink and not be so greedy!!!!!!!!!!

[Moderator: this comment has been deleted as it did not adhere to the Community Guidelines.

Asterisks don’t ameliorate the above comment so I have reported it.

It was a response to a six-year old comment about the TV Licensing organisation. TV Licensing is not a government operation since it is run by the BBC.

I reported it as soon as I saw it.

Me too. But it is still there. I thought three reports automatically removed a comment for moderation?

Perhaps that is just a myth then. Nonetheless, it is good that we all agree the offending comment should be removed. In the last few weeks, I think I’ve noticed quite a few instances of posters turning up here, only to fling a few insults and then run away.

The offending comment is there no more but a number of orphan comments remain casting doubt on the comment from Jules that now sits atop this thread.

Five comments (make that six with this one) will now have to be removed. It’s best just to hit the report button and the offending comment will be dealt with. At weekends and bank holidays it can take longer, but commenting just draws attention to offensive comments.

Might as well make it 7 comments to remove.😎

3 reports used to remove posts, plus some of us were trusted with being able to remove offending posts, but the ability was retracted probably after Patrick Steen left.

Looks like an opportunity to post:

I tend to disagree, Wavechange.

I think it would be best if the moderators deleted the offending text and substituted something like “An offensive comment has been removed. Please do not use obscene language or swear words on this site”. The comments from other readers would not then be marooned. To use the modern parlance, I think ‘calling out’ the objectionable language when it appears shows that some of us care about the etiquette of this site and are prepared to be identified. It’s the moderators’ decision whether or not to delete the comment and if they did so quickly enough there would be no build-up of comments that would, I accept, draw attention to the breach of the guidelines.

I don’t know whether or not the editorial team communicate with the individual commenter but I should like to think they do, nor do I know whether in this instance the asterisks were put in by the commenter or by the moderating machinery; if the latter, then I think the system is deficient. The writer was entitled to express his thoughts on the government of the day and could have done so without causing offence.

Just as we don’t want censorship, we can’t allow foul language to become the norm even when camouflaged under asterisks.

I don’t want offensive comments any more than you, John. As far as I know the normal practice is still to keep the rest of the text and provide an explanation that the post has been edited in accordance with the rules for the site. Here the offending comment was a single line by an unfamiliar contributor.

I’ve had plenty of offensive comments removed by clicking on ‘Report’.

I think posting that you have reported a comment, for whatever reason, will encourage others to do so and hopefully ensure it is quickly removed. I doubt we draw many peoples’ attention to the reportable comment and I’m sure most people will not suffer by reading the comment. It may also point out to the contributor that it is not acceptable.

I agree with Malcolm.

I have sometimes just used the ‘Report’ button and a contravening comment has been modified or removed.

With grossly offensive language or content I feel it is better to make an example of it and show to the writer, and to other readers, what is not acceptable. The editorial team still have freedom to determine what happens next both to the comment to its contributor.

It is a concern that at weekends and bank holidays offensive material may remain visible for a lengthy period and, if reporting it is not declared, then people might think that sort of thing is acceptable. I can’t help it if my action has led to this discussion being left open for a long period disrupting the flow of this Conversation; if my report had been attended to sooner none of these further remarks would have appeared.

The web and social media are littered with profanities, but fortunately there are very few offensive posts in Which? Conversation, due no doubt to the overall good conduct of contributors, the sensible community guidelines, and the generally appropriate actions of the editorial team.

Richard says:
4 August 2014

Here’s one for you to think about and comment on. I really think this sums up the stupidity of the whole system.

I am 6 months away from the age of 75 and am looking forward to my well earned free TV licence – this is the last of the free to claim options for pensioners as most other you can claim from 65 or earlier, but I will settle for this change in 6 months.

Two weeks ago I contacted the TVL authority to tell them I was going to cancel my Direct Debit as I’m six months in advance and this would cover me up to the age of 75.

Guess what I was told – I have to pay up to 75 and then declare I am 75, at which point they will refund me the 6 months. Obviously I asked the person at the other end ‘what planet’ he was from – sorry, but it did irk me a little, but he explained that the ‘system’ wouldn’t allow him to declare I was 75, six months early, so there was no way around it.

I told him that I was going to cancel the DD anyway and he started to warn me that I could be challenged for not paying for the licence. I finished with take me to court and then see how stupid you look when its found that I have paid to the end of my need for a licence – what a crazy world!

Good man.

The problem with this solution, is that it WILL affect your credit score to cancel and not pay a DD that a company request – regardless of you being right in this situation. (I work for a bank and see this a lot)
It is so wrong.

Cancelling a direct debit mandate does not mean that the licensee will not pay for a new licence if required so enforcement action could not be taken on that ground alone.

Since Richard wrote his comment in August 2014 the situation has presumably resolved itself by now anyway.

Sannas says:
5 January 2015

I do have a major issue with the way that the BBC and the government conduct business in regards to licencing. Its an archaic Idea that to be honest doesn’t fit in the modern world of business. I agree that people shouldn’t have to sit six months in advance for services not yet received. Other broadcasters have a proven track record that this is not a necessary way to carry out business, and lets be honest you get far more for your money in comparison. Looking at the BBC’s financial reports the average time spent utilizing all of BBC’s services is 18.5 Hours per week. For all those quoting maths as their forte as if they are something of a genius to all the minions below them then I would like you to consider this, if the 18.5 hours average is accurate and un-biased, then this is something you should consider – The BBC offer 27 channels in total for effectively £12.13 per month based on the Annual charge, compare this to Sky’s current base package of 275+ channels including the BBC, which I would like to remind you SKY charge you for as they HAVE to pay the BBC to re-broadcast(Making all those sky box users out there pay for BBC twice) at the price of £21.50 per month base package. Virgin Media offer 70+ channels including the BBC for £18 per month(Again virgin media charge you for the ability to watch the BBC as they are charged re-broadcasting fees). I could take other broadcasters but lets just stick with these 3.

The term channel doesn’t necesarrily refer to a tv broadcast, your licence also pays for the radio stations.

These charges are per month
BBC per channel cost £0.45
Sky per channel cost(inc BBC)* £0.08
Virgin Media per channel cost(inc BBC)* £0.25

*These are based on base package prices, higher prices incorporate bigger discounts.

Ok so thats one area that I feel the BBC isn’t value for money but lets go back to the 18.5 hours average time spent on any of the BBC services per week. For me this statement is a massive over exageration but its an average so I must be one that is below average. However when looking this goes a little further when you look at a 2011 report BBC news carried out, it stated that industry figures suggest people watched 30 hours of television in general per week, the BBC carried out their own poll which suggested it was more along the lines of 20 hours per week. Now I wont jump the gun here as there is reportedly an average of 23 hours per week spent listening to the radio in 2012 and the BBC have a portion of this. I know the figures aren’t 100% accurate but I feel that over a 3 year period the averages aren’t going to have dramatic changes. So you can say they will serfice, if you agree then the BBC are claiming roughly 35% of all viewing be it visual and audio or just audio by the populace just to the BBC services alone, I think you have to agree thats quite an astounding claim when their are roughly 362 radio stations nationally, including the BBC’s 17 and Sky offers 560+ English channels(not including HD replacements) which also includes BBC’s 10 channels.

But lets move on, because the BBC now have their on demand feature, you are now obliged to buy a full colour TV licence if you own a smart phone, because you can receive BBC on demand on your phone, this applies to any electrical device that has the ability to pick up any kind of internet signal. This blew me away to be honest as, I was told this by someone at TV licensing, which divulged into my accusations of ‘Air Tax’ due to a statement he made that any broadcast over cable or air was subject to TV licencing.

Lets take that paragraph one step further for any other country around the world – “the BBC sells broadcasts to other countries and people watch them for free”, was what someone else has stated. Well this isn’t strictly true BBC broadcast’s in other countries are often interupted by advertising, if not then they are premium service’s added at a cost like sky movies are to us here. But heres the interesting fact, a lot of people from other countries circumnavigate any fees locally by using proxy servers to appear in the UK(genius). So who picks up the bill for that? You do again as the BBC charge you for everyone else who can watch for free.

If you leave the house your living in and move in with a partner, or move abroad the BBC will not re-imberse you fully for what you have paid in advance like you get with car tax.They will only refund quarterly expenditure so you have to be nice and generous and give the BBC up to a 3 month tip for their service. Now this is another thing that the TV licencing crowd are very good at ripping people off with.

Bottom line is the BBC/TV Licencing are making money hand over fist for lets be honest not the greatest TV in the world. It once was considered to be the best but everyone else has since caught up in quality in my opinion. And to believe its the best is a little set in your ways, and a strong supporter of an organisation that strips the people of the UK of more money than it should.

Jan Simpson says:
30 November 2016

All dead on the ball and what stopped me from paying to the beeb is all the blatant propaganda, most worthy of what they used to accuse Russia of. I’m sick of paying the beeb news channels to filter out the real news and feed us with government b******t. If they want to do Sports news instead of real news (distraction reporting) they can do it without my contribution. Pwthhtt.

Robin says:
2 September 2015

There’s a lot of waffle going on…

Weighing up this system vs that system is irrelevant to me, all I know is that the government get enough off me as it is without me giving them 6 months money for nothing! I don’t listen to the radio and I don’t watch the BBC at all so I think the license fee should be scrapped and the BBC racketeering outfit privatised completely anyway!

This comment was removed at the request of the user

Can I stop tv licence payment after 6months when my licence will be payed for. I would rather save the money for my licence, didn’t know the facts when I decided to pay by direct debit.

I cancelled my license in 2011 and got 6 months refund this time I got just 3 months refund yet I have paid 6 months in advance. I was notified in March that my license was ready to view, they owe me two or three months license fee either that or I will watch the TV and sod them for 3 months

James Collier says:
3 September 2016

I have gone against what the TV licencing want and have been paying £15 per month since the start. They have now put a company called Akinika on to me threatening to take me to court and saying I owe £42.30. I have sent an email back stating I am paying my TV Licence but am not willing to pay in advance.

I have said that they can feel free to take me to court on the matter as they cannot say I don’t pay as I do, I just don’t pay 6 months in advance.

I am happy to support anyone who refuses to pay 6 months in advance for tv liicence and urge people to publicise this scandal. Why has this been allowed to continue.

To add to this debate, I want to point out that not only do they take £72.75 “as a deposit” which is what the a TVL help desk operative called it when I phoned them, but they don’t even refund that money automatically when you die and your account is closed by a surviving family member. It is conveniently forgotten about.

I can vouch that this is the case as my partner died suddenly two years ago, and when I cancelled her license that was in her name, I had to open a new one at the same address in my name and opted for the monthly payment system. After six months I had paid for the license with 6 x £24 installments, then was told I ‘d have to pay for next years in advance with 12 x £12 payments that my partner had been paying previously. Alarm bells rang. Big ones. Where was her over payment “deposit” refund? Her license had been cancelled for over 6 months, and the family had never received any refund payment nor any letter stating a payment would be made. The TVL knew she had died, as I had informed them. They simply kept the money. I was disgusted, and phoned them making them aware of this, and demanded an immediate refund. A few days later I got one, but only after a pretty fiery complaint, as I was recently bereaved so not in the mood for bureaucratic BS.

It’s pretty sad that they did not issue it automatically, knowing this account holder was deceased, and that a surviving partner that had already contacted them was dealing with her affairs, so therefore could be reimbursed. I wonder how much money the Gov and the BBC are sitting on in unpaid refunds to dead people, and to people that don’t need a license now and just don’t realize they have overpaid?

It’s nasty business. I hope others that have had family members die and not been refunded read this, and call TVL and get their money back.

Jan Simpson says:
30 November 2016

I have just found this out, just had a letter from them telling me I have missed a payment of £7.50. I have NEVER had an arrangement of this amount to them but I was in arrears on my last licence which I paid up to the collection agency they put in charge. As far as I was concerned I am fully paid up. I rang the collection agency and they confirmed this. My licence is valid till February next year. They got through to TV licencing who consequently “hung up” on them and I was given a direct number to ring through to. Rang that. Was told “Oh yes, you have a current licence but we have started a new licence as from when your last payment came in” SO they are taking payments in advance illegally. They made no fuss when I said “OH NO YOU’RE NOT! YOU CANCEL THAT IMMEDIATELY!!!
[This has been edited to fit with our community guidelines https://conversation.which.co.uk/commenting-guidelines/. Thanks, mods.]

Jan Simpson says:
30 November 2016

Just how many poor people are they suckering in to this illegal payment system? The girl I spoke to in TV licencing said “its the law”. I said “you can’t charge somebody for a future event they haven’t had yet”

I moved home and cancelled my TV licence in August having already forcibly paid for a years worth in advance in March the same year. Now it is November and still no sign of my refund cheque. Complained to them and heard absolutely nothing. Typical government body.

That’s before you start me off on being ripped off on pension because I paid to top up my NI contributions only to be told it was a waste of time because a new pension system started in 2016 and I will have to top up again to get the full amount in the new pension. I am also to retire a year later costing me a years pension and years bus pass. Pensions will go up but no longer a free TV licence for the over 75’s so pensions have not gone up at all. What a big con.

Just grin and bare it!

While your expected date of retirement was postponed were you not receiving an incomed from your continued employment?

Given that people really are living longer, and therefore drawing a state retirement pension for more years than originally contemplated, either the starting point had to be moved forward or the value of the pension reduced. The government chose the former method with considerable justification in my view. In recent years the state pension has risen at a higher rate than inflation or wage levels each year.

Taking away a benefit like the free TV licences for households including someone over 75 was always going to be controversial, and the BBC could have handled it better, but in withdrawing the subsidy the government left the BBC with little choice if it was going to maintain the wide spread of broadcast services. Whether that is beneficial is also debatable.

finlay smillie says:
6 April 2020

After I decided to pay by tv card monthly I found out I was paying double for the first six months (unbelievable!!), can I legally stop paying after six months as I have paid for the year.

Sharon Cooke says:
5 March 2021

I pay my licence on a monthly plan.After I make a payment,within a day of the payment being made,I receive a text message,telling me I havent paid.I contacted the Tv Licencing,and they said it is a scam.Its a bad thing when both themselves,and the money wasting BBC cant sort this out between themselves.Its about time it was scrapped altogether

Sharon – How would you like to pay for radio and TV reception if the licence fee was scrapped? The obvious alternatives are commercial advertising on the BBC [which depends on the appeal of the programmes] and a subscription system for the BBC channels you wish to watch. Compared with other services like mobile phones and decent newspapers and magazines the licence seems incredibly cheap to me.

I don’t think either the licensing organisation or the broadcaster are able to prevent scammers from messaging mobile phones if they have obtained the numbers, however it is suspicious and points to an inside job or a hack on the database [but that should not contain licence-holders’ phone numbers].

Rozanne Whitehouse says:
23 March 2021

9 years, I was fighting with them over this. Every year been referred to debt collectors and every year they had to back off as they knew I was right. Finally this week, I’ve had a letter ‘you’re eligible for our new Simple payment plan’. Guess what that is, £13 ish a month over 12 months on a date of my choosing. Hallllllelllujah!!!!!!

This is nothing short of overt embezzlement. How many people actually claim this refund. I’m sure when I die and my sheltered flat is empty the last thing on my son’s mind will be filling in a complicated form providing my Death Certificate and my Will to the TV Licensing Department naming him as executor. Apart from keeping money and making interest from it I would like to know just how many people actually claim this refund. I am going to have this stopped supposing I have to go to court to do it. It’s theft in all but name.