The broadcaster said this afternoon it will now restrict the free licences to pensioners who meet strict criteria.
And so, the BBC has made a decision to implement a scheme whereby from June 2020, anyone aged 75 or over who receives a Pension Credit from the United Kingdom government will also be entitled to a free TV licence funded by the BBC.
This ruling only comes into affect with elderly residents who receive Pension Credit - and comes into play from June 2020.
The Government has been criticised for forcing the financial burden onto the BBC, which was unable to cope with the added cost.
Shadow culture secretary Tom Watson previously said the Tories are "outsourcing welfare policy to a public broadcaster" and breaking their 2017 manifesto commitment to keep the pensioner benefit for the duration of the Parliament.
Caroline Abrahams, of Age UK, said: 'This will cause enormous anxiety and distress, but in the end it is the government's fault, not the BBC's'.
Mr Paisley said the announcement would create "suspicion that the BBC has taken the easy option". Under the agreement, the BBC would receive some funding boosts in return for taking the potentially financially ruinous responsibility for providing services to the over-75s.
Lord Hall has announced that licence fees will now be linked to Pension Credit and will be means-tested.
"All the evidence shows Pension Credit is massively under-claimed, which means that in the future the very poorest pensioners will now miss out on their TV licence as well", she said.More news: Journey through Greek mythology in Ubisoft's Gods & Monsters - out in February 2020
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Face-to-face assistance will be provided for older people delivered by specially trained customer care field staff and the size of the TV Licensing customer support call centre will also be increased.
A pensioner has described the impact that changes to the TV licence fee for the over 75s will have on the working classes as another "nail in the coffin".
Millions of households will have to start paying £154.50 a year from June 2020 for the right to watch live television and access the BBC's iPlayer service.
However, it will allow the BBC to avoid £500 million in cuts that would have led to the closure of channels. If you're watching Brian Cox's The Planets on BBC Two just now you'll know how much that ideal still means to us.
In fact a recent consultation of 190,000 people found that 52 per cent of them were in favour of scrapping or reforming free TV Licences.
Will you or one of your loved ones lose their free licence?
"It would not be right simply to abolish all free licences".
"The select committee intends to question the Chairman and Director General of the BBC about the results of its consultation and the impact this will have on viewers and listeners".