Capita keeps TV contract

The outsourcing firm Capita is to handle the BBC's TV licensing collection and administration for another eight years.

The deal, which comes into force in July, is expected to be worth about £560m to Capita but it will also save the BBC more than £220m over the contract.

Zarin Patel, BBC chief financial officer, said: "Capita's bid was the best both in terms of innovation and efficiencies and so offered best value for money."

Capita took over management of TV licensing from the Post Office in 2002, with 1,200 people employed on the contract.

As well as reducing the rate of evasion, Capita has focused on increasing sales and the proportion of direct debit customers.