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The BBC has shifted its position on using the word “militant” to describe Hamas in the wake of criticism in recent weeks over how the UK public broadcaster has reported on the conflict in Israel and Gaza.

The Board of Deputies of British Jews, a Jewish communal organisation, said that in a meeting with BBC director-general Tim Davie on Friday he had confirmed it was no longer BBC practice to refer to Hamas as militants.

He said the broadcaster would instead continue to describe the group as a terrorist organisation proscribed by the UK government and others, or simply as Hamas.

In a statement after the meeting, the BBC said it “does not . . . use the word terrorist without attributing it, nor do we ban words”.

It added that “for some days we had not been using ‘militant’ as a default description for Hamas, as we have been finding this a less accurate description for our audiences as the situation evolves”.

The BBC has also come under criticism from Israel and from UK politicians over an early report on the bombing of the Al-Ahli Arab hospital in Gaza City, when the cause of the explosion was unverified.

On Thursday, the BBC said it accepted “that even in this fast-moving situation it was wrong to speculate in this way” but added that the correspondent who reported on the blast “did not at any point report that it was an Israeli strike”.

Davie is also set to meet the 1922 committee of Conservative MPs next week. Arranged in July as part of regular discussions with parliamentarians, Davie will probably be quizzed on the broadcaster’s reporting of the conflict.

The UK government is nearing key decisions about the future funding of the BBC. Ministers are looking at ways to squeeze the BBC licence fee next year by linking it to the lowest possible rate of inflation, according to people familiar with the matter.

Government officials said culture secretary Lucy Frazer was “considering options” for how to measure inflation and limit a planned increase to the fee due to concerns over rising living costs.

The licence fee is fixed at £159 a year until April 2024, when it will increase in line with inflation for four years, under a deal struck last year.

The Department for Culture, Media and Sport said: “Exactly how a future increase would be calculated is yet to be confirmed. The BBC’s funding model faces major challenges due to changes in the way people consume media, which is why we are working with it to look at ways to ensure it is sustainable in the long term.”

The public broadcaster has long come under scrutiny over the licence fee, a tax that provides the BBC with its main source of funding, but is now facing new pressure in light of the cost of living crisis.

The government is considering using recent or future monthly consumer price inflation — which stood at 6.7 per cent in September — rather than a blended figure based on last year’s price rises that would set the licence fee at a higher rate, two people said.

One BBC official said: “Any change to a September spot rate would save about 1p a day to licence fee payers, but would take hundreds of millions out of UK content production as there is no room for further cost efficiencies above our existing plans.”

The government will confirm next year’s BBC funding package in the coming weeks, according to people close to the matter. It will conduct a midterm charter review into governance at the broadcaster later this autumn.

Frazer also committed to look at the possibility of alternative funding models after December 2027, when the current agreement ends.

Ministers are also looking more widely at how they will bake in the high inflation rates of the past 12 months into future spending decisions.

Jeremy Hunt, chancellor, is considering whether to uprate benefits in line with the 6.7 per cent CPI figure — the usual reference point for increases — or whether to impose real-terms cuts.

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