The Public Accounts Committee report finds that the BBC has increased licence fee revenue every year since 2010–11, to £3.74 billion in 2015–16, and has reduced collection costs by 25% in real terms between 2010–11 and 2015–16.
Evasion rate not down to target levels
However, with the evasion rate currently standing at between 6.2% and 7.2%, evasion has not reduced to the levels targeted by the BBC and its main contractor Capita.
Every percentage point of evasion costs the BBC over £40 million a year in lost revenue. Furthermore, Capita's performance on enforcement visits has been poor.
Some three million enforcement visits were carried out in 2015–16, but 18% fewer evaders were caught than in 2010–11, when only 2.7 million visits took place. Capita is unclear about the reasons for this and about its plans to improve the situation. We are also concerned by recent reports of improper conduct by some Capita staff.
Altogether, the BBC and Capita have much to do to improve evasion and enforcement performance.
Legacy ICT system replacement plan recently abandoned
Over many years, the BBC has also intended to replace the legacy ICT systems it uses to support the collection of the licence fee, but it has been unable to do so, having recently abandoned its latest programme to upgrade the system.
There is no sign of these problems being resolved, and it is not clear when and how the BBC and Capita will replace their legacy ICT.
We urge the BBC, in conjunction with Capita, to establish fresh plans to make ICT systems fit for the future as soon as possible.