The BBC will return nearly half the £600 million (€734m) fund it was given to help the elderly and disabled convert from analogue to digital TV after the switch proved more straightforward than many people had feared.

A total of £603 million was allocated out of licence fee revenues to help the over-75s, the blind and partially sighted and with other serious disabilities get digital TV.

Eligible households were given free help to convert one set, but the total cost has been much cheaper than the original projection which was at the top end of expectations and at a time when digital take-up was much slower.

The BBC, which has helped nearly 1.2 million people to date, expects to return almost £300 million of the £603 million fund to the government, substantially higher than previous estimates of a £250 million underspend.

The money will be spent on broadband rollout and culture secretary Jeremy Hunt’s plan to develop new local TV services across the country.

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