THE BBC is facing “very difficult choices” after a Treasury briefing revealed details of the proposed licence fee settlement.
It confirmed months of speculation – mainly fuelled by government leaks – that the BBC is to get a below inflation rise.
The reported deal isn’t as bad for the BBC as some experts had feared but it’s still bad news for director general Mark Thompson.
Although it won’t be finalised and formally announced until the New Year, the settlement agreed within government means the BBC will not have anything like the cash it said it needed for its future plans.

The BBC move to Salford would now be in serious doubt if Culture Secretary Tessa Jowell had not told MPs earlier this week that she expected it to go ahead.
“The government will ensure that the structure of the licence fee settlement makes it clear that the move to the north west should happen,” she added.
Even so, the details of how that will work have yet to be revealed.
In an email to staff today, Mr Thompson said he still awaited official word on the licence fee settlement.
But he added: “If – and it’s obviously a big if – the core of the settlement is as reported, it would be a real disappointment.
“While by no means as bad as some of the leaks and speculation about the settlement this autumn, it falls short of the funding which we and the board of governors thought was necessary to deliver the government’s own vision for the BBC which they laid out in the White Paper earlier this year.
“In practice, that would mean some very difficult choices for the new BBC Trust – and indeed for all of us.”
Mr Thompson continued: “It’s important to stress that we have yet to see any official announcement – indeed there are some important aspects of the settlement about which we have heard nothing at all yet.”
The BBC has plenty of critics who will be pleased to see its revenue cut in real terms.
But the way the government has delayed this settlement and then drip-fed details does it no credit whatsoever.
Will the BBC move to Salford? We’ll find out in 2007.