The BBC is over-charging millions of people for their licence fees by selling “annual” permits that only last 11 months, it can be disclosed.
The corporation has been making up to £25m a year through the little-known loophole, which has been condemned as “unfair” and a “rip off”.
Any viewer buying a TV licence for the first time is charged £145.50 for a year-long permit.
But under current arrangements, the new licence expires 12 months from the first day of the month in which it is purchased. This means that an ‘annual’ licence bought on April 30 2012 will actually run out at midnight on March 31 2013.
Licence fee payers have complained that the payment quirk means they are getting as little as 11 months’ worth of licence when they have paid for a full year.
One licence fee payer, who contacted one newspaper but asked not to be named, said that the BBC was being “underhand”.
“I got about 11 months of coverage instead of 12 months. A letter from the BBC said ‘Enjoy a year’s worth of television’ but I had to renew my licence 11 months later,” the man said.
The £145.50 cost of an annual licence breaks down at £12 a month. Around 2.1 million people bought a new licence last year, a BBC spokesman said. This means that the BBC could have profited by up to £25 million last year due to the curtailed length of the ‘annual’ permits it sold.
It is understood that the loophole has been in place since 1991 when the BBC took over the administration of TV licences from the Licensing Authority, but it has only just come to light after a complaint to the BBC Trust.
John Whittingdale, MP for Maldon and chairman of the Culture, Media and Sport select committee, said: “I entirely understand why people think it is unfair. They are having an average of 15 and anything up to 30 days of TV watching – which they think they have paid for – taken away from them.”
“I quite understand why people feel they’re being ripped off.”
The news comes as the BBC is trying to save £670 million a year by 2017 as part of a cost-cutting drive.
The monthly renewal issue affects all people who buy a licence for the first time, either online or through the post. Once they already have one, it is updated annually on the same date.
A spokesman for the BBC’s TV Licensing division denied that the corporation is short-changing consumers.
The spokesman said that it would cost “hundreds of thousands of pounds” to change the monthly renewal system.
“Setting monthly renewal dates minimises collection costs and means more money is invested in the BBC’s programmes and services. This issue affects a small proportion of payers and only affects them the first time they buy a licence.
“To give each a daily renewal date would cost hundreds of thousands of pounds which is not good value for the majority of licence payers,” the spokesman said.
Mr Whittingdale said it is “another example” of why the licence fee is no longer an “appropriate method” to finance public sector broadcasting.
“I think the licence fee as a way of financing the BBC has become anachronistic,” he said.
The BBC Trust, the corporation’s governing body, received a complaint about the system from a licence fee payer late last year.
In February the complaint was considered by a panel of the Trust’s Complaints and Appeals Board (Who are on the BBC payroll).
In a ruling last month the Trust said that its system complies with The Communications (Television Licensing) Regulations 2004. It said that changing its policy “would not be in the interests of licence fee payers as a whole”.
However the Trust said it would make its policy clearer to customers when they buy a new TV licence.
“The panel emphasized the importance of the BBC being transparent about its policy,” the Trust said in its ruling.
There are 25 million TV licenses in the UK in total.