George Osborne has accused the BBC of becoming “imperial in its ambitions” following reports that he plans to raid the institution to help cover the benefits bill.



In an interview days before his first budget as the chancellor of a Conservative government, he said the publicly funded broadcaster must also make a contribution to dealing with the deficit.

The chancellor made his comments on the BBC’s Andrew Marr Show, in which he also ruled out reducing the 45p tax rate and disclosed he would be cutting the benefits cap to below £23,000 for those living outside London.

“The BBC is a publicly funded public institution. It does need to make savings as we get our house in order. We are in discussions with the BBC … and I am absolutely sure that they can make a contribution,” he said.

The Sunday Times reported that the chancellor could also announce measures that would see the BBC take on the cost of free television licences for the over-75s, which amount to 4.5m licences at a total cost of more than £650m.



In return, the BBC would be able to charge for the use of its iPlayer service to recoup some of the revenue lost by a decline in live TV viewers, the paper said.

The corporation announced last week it was cutting more than 1,000 jobs because of a £150m shortfall in its licence fee income as more people watch programmes online.

Osborne added that the BBC’s website and its role should be scrutinised further to ensure it does not crowd out newspapers and their websites.

“What is the Times, the Telegraph, the Daily Mail or the Sun or the Daily Mirror going to look like in 10 years’ time? It is going to be an online paper probably.



“If you’ve got a website that’s got features and cooking recipes – effectively the BBC website becomes the national newspaper as well as the national broadcaster. There are those sorts of issues we need to look at very carefully,” he said.



“You wouldn’t want the BBC to completely crowd out national newspapers. If you look at the BBC website it is a good product but it is becoming a bit more imperial in its ambitions.”



Labour MP Paul Farrelly, a member of the culture select committee in the last parliament said: “Before the election, when the select committee reported on the future of the BBC, the chair - who is now the new secretary of state - was adamant that the BBC should not pick up the tab for free TV licences, as this was social policy. This is an early test of whether he is strong enough to stick to his guns, or whether it is the treasury that calls all the shots.”

In the interview, Osborne dismissed calls from the Conservative right to cut the highest rate of income tax from 45p to 40p, saying that the government must first stick to its election promises.

He added that he was also planning in the budget to cut the benefits cap for those outside London to below £23,000 a year.



“It is not fair that people out of work can earn more than people in work so we are going to cut the benefit cap, as we said in our manifesto, to £23,000 in London – it will be lower in the rest of the country,” he said.

In May, the reduction in the upper limit of what families will be able to claim annually from £26,000 to £23,000 was announced in the Queen’s speech.

The chancellor also confirmed reports that he plans to increase the annual charges paid by those domiciled outside Britain for the purposes of tax. The loophole is one of the few issues that Ed Miliband was able to use to damage the Tories during the election campaign.



“With non-doms, I have jacked up the amount of money they pay every year for that non-dom status,” Osborne said.

Since its introduction in 2008, the annual charge has increased from £30,000 to up to £90,000 for non-doms who have lived in Britain for 17 years or longer.

The chancellor will also formally announce in the budget that people on higher earnings will have to pay up to the market rate for their council houses which is expected to raise to £250m a year.



Local authority and housing association tenants on incomes of £40,000 or more in London and £30,000 in the rest of England will have to pay a market, or near market, rent from 2017/18.

In the case of those living in local authority properties, the extra cash raised will go straight to the exchequer and help towards reducing the country’s debt burden.

Writing in the Sun on Sunday, Osborne said: “Those earning £40,000 a year in London and £30,000 a year in other parts of the country will have to pay the market rent or at least something close to it, if they want to stay in their homes. It’s a simple matter of fairness.

“The welfare system I want to see is one that helps people to get good jobs instead of giving them handouts.”

On Monday, Mark Carney, the governor of the Bank of England, will meet with David Cameron and Osborne to discuss any fallout from the Greek referendum.

“The Greek situation has an impact on the European economy, which has an impact on us,” said Osborne.