The percentage increase was determined using September's rate of inflation which means, due to the recent fall in inflation, the higher fee is actually less than what the BBC and the Office for Budget Responsibility had anticipated.
The BBC had expected a rise of around 9 per cent, based on the average rate of inflation over the past 12 months.
BBC News reports it will consequently leave an expected funding gap of £90 million.
Frazer said the government had kept the fee as low as possible and noted that the increase amounted to an extra 88p per month.
By entering your details, you are agreeing to our terms and conditions and privacy policy. You can unsubscribe at any time.
The BBC responded the the announced in a statement, saying: "The BBC is an important and beneficial intervention in the UK media market.
"It is absolutely right that we debate how it is best funded to ensure that the BBC can thrive, not just today, but in the future - performing a role where it projects the UK’s values across the globe, while also producing impartial news, and telling stories through our content that reflect the real lives of people across the UK.
"That role should not be separated from the debate about funding.
"We believe that public service should be at the heart of the BBC and we need to ensure that if there are changes, that the public fully understands the implications of them, so that we all have a BBC that everyone can support and benefit from."
The BBC also added that the government has confirmed the licence fee will be in place until at least 2027/2028.
Check out our TV Guide and Streaming Guide to find out what's on.
Try Radio Times magazine today and get 10 issues for only £10 – subscribe now. For more from the biggest stars in TV, listen to The Radio Times Podcast.
