The BBC’s studios in Salford, Greater Manchester
The BBC’s studios in Salford, Greater Manchester © Getty Images

The BBC has unveiled plans to pare back its output, shutting two television channels and axing 1,000 jobs in a bid to cope with inflation and the squeeze on its licence fee funding.

The restructuring, which is aimed at saving £200mn annually, marks a turning point for the 100-year-old corporation and is the first indication of how director-general Tim Davie is looking to reshape the BBC for an era of austerity and “digital-first” programming.

The broadcaster is under pressure on several fronts. Culture secretary Nadine Dorries has imposed a two-year freeze on the licence fee, the BBC’s main source of funding; production costs are rising; and the BBC’s long- term financing is under review.

The corporation has estimated it needs to plug a hole of about £1.4bn over the next five years, and Davie has sought to use the belt-tightening as a way to accelerate the shift of resources to digital channels and away from traditional broadcast and radio outlets.

As part of those efforts, Davie will shut the BBC4 and CBBC television stations in 2025, effectively making the services online only. The BBC’s two rolling news channels, serving UK and international audiences, will be merged.

Davie told staff he plans to cut or reallocate about £500mn of annual spending, which amounts to around a 10th of the BBC’s annual revenue. The broadcaster’s public arm will shed about 1,000 jobs, roughly 6 per cent of its headcount.

Approximately £300mn of the reallocated spending will be moved from traditional broadcasting and diverted into spending on online content, which can be consumed on demand.

Original programming for television channels will be cut by 200 hours, as Davie pushes the BBC towards concentrating its spending on fewer shows that deliver the highest impact. Funding for BBC World Service will be reduced by £30mn a year.

Davie said: “When I took this job I said that we needed to fight for something important: public service content and services, freely available universally, for the good of all. This fight is intensifying, the stakes are high.”

Separately, the government on Thursday launched the planned midterm review of the BBC’s governance and market impact, which will examine the oversight of its editorial standards, impartiality and how it is overseen by the regulator Ofcom.

The 12-month review is part of several strands of work feeding into negotiations over the BBC’s next charter, which will set out its goals and financing from 2028 onwards. This will include a review of its funding model and the licence fee, which the government has signalled it wants to overhaul.

Dorries also introduced a legal obligation for the BBC to meet its commitment to draw a quarter of its employees from low socio-economic backgrounds by 2027. She said the initiatives would help the BBC “adapt to a rapidly changing landscape just like all broadcasters are”.

She added: “This review will build on our recent progress to make the BBC more accountable to those who fund it, level up people’s access to the job opportunities it offers and ensure it continues to work in the best interest of the public.”

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