The cash-£5 out of every £142.50 licence fee- will be used to fund regional news and other local programmes.
Communications Minister Lord Carter will outline the revolutionary change in the Digital Britain White Paper on Tuesday.
Private TV companies will be able to bid for contracts to run the regional programming.
It is the first time the £142.50 fee has been sliced up and given to rival broadcasters.
ITV bosses have warned they can no longer afford to pay for regional news, which they have to show as part of a commitment to provide public service broadcasting.
That would mean regional programmes would only be available on the Beeb, a monopoly the Government opposes.
The paper will also include an ambitious pledge to provide every household in the country with a fast broadband connection by 2012, a promise to set up publicly-owned digital channels and a "value for money" deal that would force the BBC to shed thousands of jobs.
There are also plans to replace AM and FM radio with digital radio by 2017-three years early, and an anti-piracy watchdog will be set up with the power to block websites that swap pirated music and video files. There will also be a fund to help ailing regional newspapers.
The BBC will be bitterly opposed to any move to give part of its £3.6 billion-a-year licence cash to anyone else.
BBC Trust Chairman Sir Michael Lyons said fee money should not be used to pay for "things that have nothing to do with the BBC's public purposes".
He said: "People would do well to remember that licence fee payers give us their money in good faith, believing it will be spent on BBC services and content. We know what the public would like to happen to any surplus . . . they'd like their money back.
"To tell them that their money is being siphoned off would be more than an act of bad faith. It would be tantamount to breaking a contract."
Please note: All comments are moderated.
Tick this box to accept our
TERMS & CONDITIONS
This article has 5 comments
I don't pay this licence in good faith, I pay it because I have no choice if I want a TV. Lets also not forget as pensioners a Very Large part of our income is taken in this unfair and valueless tax
By Pat.. Posted June 24 2009 at 3:35 PM.
why pay for the same local news twice? if one,like the BBC,is is properly funded,and the other is in dire straits as a result of bad investments and get rich quick scheme's going belly up for greedy shareholders,why should we be the ones to pick up the bill, law of the jungle should apply here,we owe the once lucrative private tv companies,currently feeling the squeeze of the credit crunch, nothing!!
By ALAN SIMPSON.. Posted June 19 2009 at 11:18 PM.
We have seen the way the BBC waste our money by overpaying little talented presenters. If they have that amount of our money to waste why not give some to ITV for public service programs.
By Frank Johnson.. Posted June 14 2009 at 6:02 PM.
BBC Trust Chairman Sir Michael Lyons states that licence fee payers give us their money in good faith. NO we dont, This is an unjust tax on people that are forced to pay or go to jail. If given the choice nobody and i mean nobody would pay the BBC anything. Scrap this tax now.
By pad.. Posted June 14 2009 at 4:38 PM.
There goes my payrise.
By Ali.. Posted June 14 2009 at 3:15 PM.