The Secretary of State for Culture, Media and Sport (Lucy Frazer)
Today, the Government are introducing the Media Bill into Parliament. The Bill will support our broadcasters and radio stations to further thrive by delivering on the key commitments set out in “Up Next”, our broadcasting White Paper published in April 2022.
As part of that overall package, the Bill will deliver reforms to support the long-term sustainability of the Channel 4 Television Corporation, which is a vital part of our globally-renowned public service broadcasting system. This statement updates the House on those measures in particular.
For over 40 years, Channel 4 has commissioned innovative and distinctive content that challenges the status quo and represents unheard voices in society, alongside supporting independent producers who are the bedrock of our hugely successful and dynamic television production sector.
However, like all our public service broadcasters, Channel 4 faces structural changes in the broadcasting landscape: changing consumption habits making audiences more fragmented and harder to reach than ever before, as well as unprecedented competition for viewers, programmes and talent, in particular from global streaming platforms.
That is why in January this year the Government set out a package of reforms to support Channel 4’s long-term sustainability while remaining in public ownership. This will include a new statutory duty on the Channel 4 board, introduced by the Media Bill, to consider the corporation’s long-term sustainability alongside the delivery of Channel 4’s public service remit. Alongside this new duty, we have also worked with Channel 4 to agree updated governance structures to support financial management and other assurance processes, including an updated memorandum of understanding between my Department and Channel 4 which has been published today.
The Media Bill will also remove Channel 4’s publisher-broadcaster restriction to enable Channel 4 to make its own content, should it choose to do so, and as other public service broadcasters are able to do. This will open up new options for Channel 4 to diversify its revenues away from linear television advertising, the market for which is in long-term, structural decline. A stronger and more resilient Channel 4 will be best placed to continue playing its integral role within our broadcasting ecosystem for many more years to come.
When announcing the Government’s plans to remove Channel 4’s publisher-broadcaster restriction, we were clear that we would work closely with the independent production sector and others to consider necessary steps to ensure that Channel 4’s important role in driving investment into the sector is safeguarded, in the event it does decide to develop its own production capability. Today we are therefore announcing a package of mitigations that we believe should achieve those aims.
First, the level of Channel 4’s independent production quota will be increased from 25% to 35% of qualifying programmes. This will ensure that Channel 4 continues to commission a significant amount of content from qualifying independent producers while still leaving sufficient room for non-qualifying independent producers, and potentially in the future Channel 4 in-house producers, to compete.
Alongside this, Channel 4 has committed to a range of measures that will ensure fair and open access to its commissions, in the event it does commence production. This includes commitments to: set up any new C4C production business as a separate company with its own board and governance arrangements; a new commissioning framework—outlining, for example, robust information sharing protocols and conflict of interest policies; a new, independent dispute resolution process for producers; and transparent reporting in Channel 4’s annual report. These arrangements will be underpinned by a new statutory role for Ofcom, which will have powers to intervene if the regulator decides this is required. These measures will help ensure that the high levels of competition and plurality that characterise our production sector, and that have made it so successful, will be maintained.
Channel 4’s support for producers across the whole of the UK remains a priority for this Government. I therefore welcome Channel 4’s commitment to continue to spend at least 50% of its budget for main channel commissions outside of London—against the 35% requirement in its licence—and that this will not be affected by the removal of its publisher-broadcaster restriction. The level of Channel 4’s regional programme making quotas is set by Ofcom. Ofcom will consider whether any changes are required to these quotas as part of its consultation on the terms of the next Channel 4 licence. We expect that consultation will begin later this year.
The Government appreciate that this is a significant change for the production sector. As a responsible Government, we want to make sure the right processes are in place to monitor the impact of this change and consider whether any further measures to support the sector are required in the future. That is why the Media Bill will also introduce a requirement on Ofcom to review the impact of Channel 4 commencing production, should it choose to do so, on the fulfilment of the public service remit for television. That remit, which will be updated by the Media Bill, includes requirements about the range and amount of programmes made outside of London as well as, for the first time, requirements about the range and amount of independent productions.
Taken together, the Government are confident that this package of reforms will deliver on our joint aims of helping to support Channel 4’s long-term financial sustainability, while ensuring that our world-leading television production sector continues to thrive.
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