The deal between the BBC and the Government over the licence fee is a significant change in the relationship between the state and the independent broadcaster. The BBC is now responsible for policy and welfare.
The fact George Osborne has achieved this deal shows the power he wields and signals to others that if even the BBC has done what it is told then others will be fearful of standing up to him.
So will other organisations consider their relationship with Government? Could they too be charged with, in effect, delivering government policy?
The BBC could start increasing the licence fee from next year as part of a deal in which it will pick up the £650 million bill to fund free TV licences for the over-75s. Lord Hall of Birkenhead, the corporation’s director-general, yesterday claimed that the agreement thrashed out with George Osborne was the “right deal” in “difficult economic circumstances”.