Channel 4 Privatisation

Alex Sobel Excerpts

Tuesday 14th June 2022 Commons Chamber

[Lucy Powell]

I do not know why the right hon. Gentleman thinks that large American media companies are more innovative than small, British-made institutions such as Channel 4, which has been innovating for the 30 or 40 years since Margaret Thatcher invented it. He might want to rethink his point. We are not known for the blander, more mainstream content that would come from the sell-off. That is not how our success has been built. Creativity means actually being creative.

[Alex Sobel (Leeds North West) (Lab/Co-op)]

My hon. Friend is making an excellent speech. I have many constituents in Leeds who work at Channel 4, but even more who work for independent production companies. Kay Mellor, the founder of Rollem Productions, recently passed away. Great creative talents such as Kay Mellor would not have been able to come forward without support such as the £221 million that Channel 4 invested in independent production in 2021. We need more Kay Mellors and more Rollems, not fewer as a result of US imports.

[Lucy Powell]

My hon. Friend makes a really good point. I will come on to some examples in my speech.

Secondly, Channel 4 unashamedly supports British jobs and the British economy. The UK’s creative industries are one of our biggest and fastest-growing sectors, contributing more to our GDP than aerospace, automotive, life sciences and energy put together. With the UK’s creative industries growing at four times the rate of our economy as a whole, most other countries are looking to create home-grown companies of the kind that our Government are actively undermining. In an era of stagnant growth, when Britain needs to win the global race for jobs of the future, why are we looking to sell off a critical part of our creative ecosystem?

Channel 4’s public service remit is integral to this success. It is a driver of levelling up in the creative industries, which have all too often been focused in London. With more than half its commissions outside London, and with headquarters in Leeds, Channel 4 supports thousands of jobs in Yorkshire and across the nations and regions. Film4 has built on Halifax’s success to make it a world-leading hub in film.

--- Later in debate ---

[Ian Murray]

I did not go either. I was not invited. Maybe after this speech I might get an invite next year, if Channel 4 is not privatised.

Let me say at the outset that this country is the best in the world at making television and films, that our broadcasters are the envy of the world and that Channel 4 is a much-loved part of that essential ecosystem. But why would that prevent the constant ideological attacks from the Government on those who contribute so much to our cultural Britain? We are proud of our public sector broadcasters and we should be backing them, not privatising them.

We have heard it said a lot today that Channel 4 is in great health, and it is. The public broadcasting model for Channel 4 works. As we have heard, in the last couple of years Channel 4 has produced record surpluses. And just for the information of the Secretary of State, who mentioned it again in her contribution, Channel 4 gets no public money. Those surpluses are invested back into the British creative economy, rather than into the hands of private shareholders. That investment, of course, is not limited to London, but goes to the entire country. Why? Because the regulations mean that it has to be. In fact, two thirds of the hours of original content commissioned by Channel 4 are produced in the nations and regions, boosting the creative economy in cities such as Glasgow. Over 400 roles at Channel 4, including senior commissioning decision makers, are based outside London, commissioning content from all over the UK for all over the UK. Perhaps another reason the Government want to privatise Channel 4 is because it is showing the Conservatives up by actually delivering levelling up far better than the Prime Minister could ever imagine. Some might say there is no reason that will not continue, but I am afraid that, with almost no conditions in the White Paper, there is little hope that it will.

[Alex Sobel]

My hon. Friend is making an excellent start to his contribution and his point is well made. Channel 4’s 4Skills initiative is based in its headquarters in Leeds. It provides opportunities in television and film for young people from right across the regions and nations, including Scotland, the south-west and the midlands, as well as Yorkshire. Without Channel 4, that would not exist. If it is privatised, there is no guarantee it will continue.

[Ian Murray]

Yes, it is the cultural levelling up that Channel 4 has been able to achieve as part of its own agenda.

Analysis by EY—Ernst and Young—which was mentioned by my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), estimates that over £1 billion would be lost from the UK’s nations and regions if Channel 4 did not invest in the way that it does now, and that nearly 2,500 jobs in the creative sector would be at risk. That is independent analysis. It is not just those directly employed by the broadcaster who would be impacted, but the entire British creative economy. As my hon. Friend mentioned, it is a creative economy that relies on economies of scale, security of funding and a pipeline of skills.

In its lifetime, Channel 4 has invested—we have heard this already—£12 billion in the independent production sector in this country. Every year, it works with almost 300 production companies, many of which are tiny, as well as medium and large-scale production companies. This proposal does not just impact the big stars in London studios, but the camera operators, the crew runners, the location scouts and everything that makes a production happen in every single region and nation of the UK. The harsh reality is that a privatised Channel 4 would be commercially incentivised to buy in programmes from overseas instead of supporting new and innovative projects in the UK. Why? Because it costs a lot of money to make content and that would hit profits. Look at some of the big loss makers, such as the award-winning Paralympics coverage which has not really been mentioned in this debate. It is a huge loss for Channel 4 in terms of its financial viability, but it does it and it does it incredibly well.

If I could reflect on the contribution made at the end by the right hon. Member for Hereford and South Herefordshire (Jesse Norman), he made a critical point. Not only did he say that there are no options papers on where the future of Channel 4 could be beyond privatisation, but he hit the nail on the head. A lot of the contributions from the Government Benches have been about the headwinds that are just about to hit Channel 4. Those headwinds will hit Channel 4 whether it is in the public sector or private sector. It is hardly a good selling point to say, “We want to privatise one of our national assets to ensure it is not hit with these headwinds,” when a commercial broadcaster would cut the very things that Channel 4 does so well in times of hardship.