The BBC TV licence fee faces being scrapped under dramatic new government plans under Culture Secretary Nadine Dorries.

The government will be looking at ways media watchdog Ofcom can “hold the BBC to account” as well as implementing new ways of funding the broadcaster, saving UK households up to £159 each year as the cost of living crisis bites.

The BBC’s director-general Tim Davie has said he would rather produce less content than compromise on quality when considering funding cuts to the broadcaster.

The culture secretary said the BBC’s model was “completely outdated” and decisions on any changes would be made “well ahead” of the BBC Charter renewal in 2027.

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New ways of funding the BBC set to be announced

Speaking to The Spectator, Ms Dorries said: “We are going to very soon announce that we are going to be looking very seriously about how we fund the BBC.

“We are ready to implement a new way of funding the BBC.

“We’re going to be looking at how Ofcom hold the BBC to account and then very shortly after that we will be announcing other measures that we are going to put into place to start looking at how the BBC will be funded in the future so that we are well in time to have that in place for the Charter renewal.”

The Government on Thursday published a white paper aimed at implementing broadcasting reforms to “create a new golden age of British TV and help the nation’s public service broadcasters thrive.”

The document did not provide further details on the BBC’s funding reforms.