Channel 4 Privatisation

Michael Fabricant Excerpts

Tuesday 14th June 2022 Commons Chamber

[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.

[Michael Fabricant (Lichfield) (Con)]

Does the hon. Lady not recall that Channel 4 was dragged kicking and screaming into moving its headquarters outside London? Has she not visited Leeds and has she visited London? Does she seriously think that Leeds can be called the headquarters of Channel 4 when most of the senior management are still firmly anchored in London?

[Lucy Powell]

So the hon. Gentleman now thinks that Channel 4 is not important to Leeds. Perhaps he might want to take up the issue with Leeds MPs and Leeds constituents, who take a very different view. They support what Channel 4 is doing in its levelling-up agenda, which is evident for all to see.

Channel 4 supports skills and widens access to the industry. At a time when employers are crying out for talent and people across the country are looking for jobs, Channel 4 is supporting thousands of young people and apprentices each year. The Secretary of State has said that her defining mission is

“ensuring that everybody from every background has access to the arts”,

so why is she undermining an important access driver in this way? Thanks to its unique publisher-broadcaster model, Channel 4 invests half a billion pounds a year on average in the independent production sector. That has helped to grow and start many of our most successful production houses.

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[Ms Dorries]

Levelling up is one of this Government’s primary objectives. We will be looking at bidders interested in purchasing Channel 4 to see whether they meet our levelling-up objective, which is about moving some of our major organisations and creating jobs outside London. That will be a consideration.

[Michael Fabricant]

Further to the last question, it is not just Channel 4; for example, it was Netflix that made “Game of Thrones” in Belfast, throwing in millions of pounds—far more than Channel 4, although I do not underestimate Channel 4’s importance.

My questions are these. First, will my right hon. Friend set out in her speech that the contract for the sale of this public service broadcaster will set out certain minimum criteria—in other words, news content, regional content and British content? Secondly, is she aware that many production companies feel squeezed out by Channel 4 —[Interruption.] Oh yes, they feel that at the moment there is a cosy arrangement with some production companies while others are ignored by Channel 4, and those smaller companies would actually welcome a change at the top.

[Ms Dorries]

As someone who has worked in the industry, my hon. Friend is deeply knowledgeable about how Channel 4 and the industry works. As I said in a previous answer, “Up Next”, the broadcasting White Paper, makes it very clear that that distinctive British content that makes Channel 4 so successful is part of the criteria.

The broadcasting White Paper is a fantastic piece of work, and I strongly recommend that everybody in the House reads it, as it makes it very clear what the Government’s objectives are for the broadcasting sector. Furthermore, we are taking the decision as a Government to look at broadcasting in the round—to look at the whole broadcasting landscape in the UK. I know that the conversation and the debate are focusing mainly on Channel 4, but we have to consider broadcasting in the round right now.

In addition, Channel 4 faces a series of unique challenges—challenges that other public service broadcasters with different ownership models do not face. Streamers such as Netflix spent £779 million on UK original content produced in 2020, more than twice as much as Channel 4. While other PSBs, such as the BBC and Channel 5, have the freedom to make and sell their own content, Channel 4 has no inhouse studio. Its ownership model restricts it from borrowing money or raising private sector capital. It is left almost entirely reliant on ad revenues. Those revenues were already shifting rapidly online, and the competition is only set to heat up now that Disney+ and Netflix have confirmed their plans to enter the advertising market. In addition to that, we have, later this year, new, huge streamers coming into our homes, which will also, quite probably, be operating on an advertising model.

Under its current form of ownership, Channel 4 has fewer options to invest, fewer options to innovate and, crucially, fewer tools with which to grow. There are serious challenges that require serious plans to overcome, not the kneejerk reaction or hyperbole of the Opposition.

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[Ms Dorries]

We agree on many things, and we agree on that.

[Michael Fabricant]

On a point of order, Madam Deputy Speaker. I may have inadvertently misled the House. I said that it was Netflix that produced “Game of Thrones”, but it was not. It was HBO and Sky Atlantic that invested a quarter of a billion pounds in Northern Ireland, considerably more than any other broadcasting company.

[Madam Deputy Speaker (Dame Eleanor Laing)]

I thank the hon. Gentleman, but that was more of an intervention; it was supposed to be a point of order. None the less, I am grateful to him for correcting the record so swiftly, so I thank him for his point.