Channel 4 privatisation plans formally cancelled

Michelle Donelan confirmed that after a review of the business case for a sale of Channel 4, the broadcaster would remain in public ownership.

However, Channel 4 will be granted greater commercial flexibility, including making its own content and a new legal duty to promote long-term sustainability.

The announcement follows a leaked letter from earlier this week that indicated Donelan’s decision to scrap the privatisation of Channel 4, a policy that had been pursued by her predecessor Nadine Dorries.

As part of the agreement with the government, Channel 4 will commit to doubling the number of planned new roles outside of London and doubling its financial investment in skills.

A Media Bill will also allow Channel 4 to make its own content as part of an attempt to help it challenge streaming giants such as Netflix.

Channel 4 has historically used independent production companies from across the UK, part of the rationale for creating the channel in the 1980s, and it works with around 300 creative companies every year.

The government argued the changes would give Channel 4 greater ability to produce and monetise its own content, which could put it on a more stable financial footing by growing its commercial income.

It added that the government would “will work closely with the independent production sector” on how to safeguard Channel 4’s role in driving investment into the sector.

Safeguards under consideration include increasing the level of Channel 4’s independent production quota, which is currently set at 25% of programmes, and potentially introducing specific protections for smaller independent producers.

Channel 4 has also committed to investing £10m, up from £5m, in skills and doubling its number of roles outside London from its original target of 300 to 600 across the UK in 2025.

The new roles include those at Channel 4’s national headquarters in Leeds, as well as in Glasgow, Manchester, Bristol and potentially elsewhere.

The Department for Digital, Culture, Media and Sport has also made it easier for Channel 4 to draw down on its £75m credit facility.

Donelan said: “Channel 4 is a British success story and a linchpin of our booming creative industries. After reviewing the business case and engaging with the relevant sectors I have decided that Channel 4 should not be sold.

“The package will also safeguard the future of our world leading independent production sector. We will work closely with them to add new protections such as increasing the amount of content C4C must commission from independent producers.”

Alex Mahon, chief executive at Channel 4, said: “The principle of public ownership for Channel 4 is now set for the foreseeable future, a decision which allows us to be even more of a power in the digital world.

“Channel 4 is innovative, editorially brilliant and loved by audiences that others don’t reach, most of all the young and underrepresented. In the analogue world, we did this spectacularly. Now, in the digital era, we are doing it again.

“I am personally delighted that we will be able to do more, making positive change for the people that others don’t fight for. We will move faster, invest more, take more risks, break down barriers and push boundaries; getting up to do that every day is an utter privilege for those of us lucky enough to work at Channel 4.”