Labour has been blasted over plans to hand benefits claimants free BBC licences under potential reforms touted by Culture Secretary Lisa Nandy.

An official Government review of the BBC’s Royal Charter said that more than half of poorer households did not keep up with their payments of the licence fee.

British officials would look at “further targeted interventions, such as new concessions or payment schedules”, as the review noted countries, including Germany, already offered free licences or discounts to those on benefits.

Also touted was a potential “top-up subscription service” offering premium content, including repeats of some of the BBC’s most popular programmes on the streaming service, BBC iPlayer.

The charter sets out the BBC’s public purpose and is the constitutional basis for the corporation, which is predominately funded through the licence fee, paid by UK TV-watching households.

In the Green Paper, published yesterday the Government also says it will explore how changes to the licence fee “will impact different household budgets.”

The report goes on to state: “Internationally, several of the models chosen to replace the licence fee for funding public service broadcasters account for household or individual income.

“In Germany, for example, concessions are available to individuals who receive social benefits and to some students and people undertaking vocational training.”

Lisa Nandy, who launched the once-in-a-decade review on Tuesday, said: “We want the BBC to continue to enrich people’s lives, tell Britain’s story and showcase our values and culture at home and overseas, long into the future.

“My aims for the charter review are clear. The BBC must remain fiercely independent, accountable and be able to command public trust.

“It must reflect the whole of the UK, remain an engine for economic growth and be funded in a way that is sustainable and fair for audiences.

“As a Government, we will ensure that this charter review is the catalyst that helps the BBC adapt to a rapidly changing media landscape and secures its role at the heart of national life.”

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However, Labour was met with backlash from the Tories, who accused the Government of being “completely unfair” in its approach to the broadcaster.

Shadow Culture Secretary Nigel Huddleston said: “It would be outrageous if people claiming benefits were given free TV licences while hard-working taxpayers foot the bill.

“Right now, more than six million working-age people are on benefits, more than the population of Norway, yet the Government seems determined to reward inactivity rather than encourage work.

“Under Keir Starmer and Rachel Reeves, this is exactly what is happening: while businesses and wealth creators are taxed more to keep the country running, some claimants could be getting free perks they don’t need.”

The BBC is under heavy scrutiny following resignations from top executives and from US president Donald Trump, who has filed a $10billion (£7.48billion) lawsuit against the broadcaster in response to the editing of a speech he made before the 2021 attack on the Capitol that was featured in a Panorama episode.

According to the DCMS, the charter review will focus on three objectives: the public’s trust, sustainable funding, and driving growth and opportunity.

The Government will consider, strengthening the BBC’s independence, giving it new responsibilities to counter disinformation, and introducing specific duties around workplace conduct.

The BBC’s current charter, which runs for 10 years, ends in December 2027.

Outgoing BBC Director-General Tim Davie said: “We welcome the publication of the Government’s Green Paper and the start of the public consultation on the future of the BBC.

“We urge everyone who cares about the success of the UK’s world-leading creative industries to have their say.

“At the BBC we want change so we can continue to deliver for the UK for generations to come.

“We want to secure a public service BBC that is independent, sustainably funded for the long term, and meets our audience’s needs.”