BBC told to pick up licence tab for UK's elderly

The globally famed British Broadcasting Corp (BBC) has been told by the UK government to pick up the £556 million bill for keeping TV licences free for citizens over the age of 75.

Ministers want to impose the move as a penalty for the corporation overpaying its presenters and executives, which has drawn much flak in the country.

Earlier this month, the service announced that Mark Byford, its long-standing deputy director-general, will leave the corporation in June 2011 and the post will be closed – making him the symbolic first casualty of a round of cost-cutting and restructuring. (See: BBC deputy director to go in job cuts)

The latest move by the government would free up half a billion pounds to allow the department of work and pensions to honour prime minister Cameron's pledge to limit cuts in benefits for the elderly.

BBC Newsnight's political editor Michael Crick said the move would be opposed, while culture secretary Jeremy Hunt has suggested the licence fee should be reduced in 2012.

Ministers were last night locked in discussions on how to transfer from the DWP to the BBC the cost of free TV licences for pensioners.