The BBC is not likely to get the full increase which it wants in the TV licence fee, Culture Secretary Tessa Jowell has warned as talks begin.
Tessa Jowell says other broadcasters should have a say
The BBC has proposed raising the licence fee by 2.35% above inflation, taking it from the current £131.50 to £180 by 2013.
Ms Jowell told peers that negotiations were only just starting.
"I certainly expect the figure to come in lower than the BBC's proposition," she said.
"But it has to be a figure that provides the viewing public with the range of the quality of services that they look to the BBC to provide."
The corporation also had to be at the forefront of innovation in programming and other services, she argued.
Ms Jowell said the government was running opinion polls to assess public willingness to pay the licence fee and how people valued BBC services.
Other broadcasters would also get a chance to have their say at a seminar in May, she said.
"I think it's important that we expose the BBC's calculations and assumptions to other broadcasters," she argued.
"One of the questions I think we need to interrogate is the extent to which the costs of other broadcasters are led by the costs of the BBC.
"For instance, if the BBC came in at a lower level for talent or creativity or innovation then to what extent would this in time also have the effect of reducing the costs facing other broadcasters; to what extent does the BBC make the market?"
Ms Jowell refused to be drawn on whether this included presenters' salaries. The reported earnings of BBC radio DJs have been leaked to newspapers in recent days.
Opening the books?
Conservative ex-Cabinet minister Lord King suggested the government's hands were tied in the licence fee talks, as comprehensive independent information on BBC finances was not available.
Ms Jowell said proposed changes would give the National Audit Office a bigger role in scrutinising BBC saving plans.
The plans would bring "unprecedented" transparency and scrutiny to the BBC, she said.
But Lord King urged her to consider giving the auditors full and independent scrutiny by being allowing them to pick exactly which subjects they wanted to examine.
Ms Jowell was asked whether the NAO should be able to look into such issues as BBC coverage of the World Cup amid reports that 300 staff would be travelling to Germany.
"That is a decision for the BBC," she said. "They will be accountable under the new governance arrangements to the BBC trust.
"They will have to provide a compelling case for the value for money that is represented for that."