Channel 4 Privatisation

Peter Bottomley Excerpts

Wednesday 27th April 2022 Commons Chamber

[Julia Lopez]

Thank you, Madam Deputy Speaker. It is important to say that tomorrow is a sitting day, and we bid for a ministerial statement on this subject.

We are very keen that the House understands that the Channel 4 sale is not a stand-alone issue; it sits within a very important series of reforms that we as a Government want to make to the public service broadcasting system. Channel 4 is an incredibly important economic asset in that ecosystem, and we want to make sure that it is sustainable not just now but long into the future. We think it is our responsibility as the Government to do that future-gazing and to make sure that Channel 4 has the freedom and flexibility it needs to be able to make changes to thrive.

There are two important things to understand about Channel 4. First, it cannot retain control of its own intellectual property, and therefore it does not have the same financial flexibility as the likes of ITV and the BBC, both of which have their own studios. Secondly, its borrowing sits on the public balance sheet, and therefore if it required greater financial flexibility in the future, the Treasury would need to be content with that.

As I say, tomorrow is a sitting day. We had very much hoped that we would be able to set the sale of Channel 4 in the context of a wider series of incredibly important reforms that we wish to make to the public service broadcasting sector. I regret that the hon. Member for Manchester Central (Lucy Powell) does not think this is an important issue and has dismissed it as some culture war. That could not be further from the truth. The last time that important broadcasting reforms were made was 2003. I hope she will agree that the broadcasting world has changed immeasurably since then, and that the Government would not be responsible if we did not address some of those changes.

We think the public service broadcasters play an incredibly important democratic, cultural and economic role in our nation’s life and we want to sustain that role, so we think the privatisation of Channel 4 is an important part of a wider series of reforms. We will make further details available to colleagues, and I will be engaging one-to-one with colleagues who have concerns as we go forward.

[Sir Peter Bottomley (Worthing West) (Con)]

The Minister may or may not have been convinced by the words that she read out, but I do not think that they convinced the House. Channel 4 is in the best state that it has been in creatively or financially for decades. We were told that it is supposed to be able to compete with Netflix, but Netflix is a loss-making, debt-ridden business whose share price is now $198 when it was $700—an enormous drop.

If the choice for the country is about Channel 4’s specific remit and structure as a publisher-commissioner that does not hold programme rights, the Government could do best by leaving it alone. If they do not, they could engage with Channel 4’s management team about its proposals—I am not sure that we have all seen them in public—and explain why they prefer to go to the United States than to have a state broadcaster that is independent of Government.

Those in government may not like Channel 4 because it may criticise the Government in its news output, but it is better to be in government and criticised than to be in opposition and cheer.

[Julia Lopez]

I thank my hon. Friend for his comments. It is important to understand that the Secretary of State and I went into the entire process with a very open mind—[Interruption.] That is certainly true. We went into this looking at what is best for the public service broadcasting sector as a whole going forward. We looked incredibly carefully at alternatives, and I hope that the material that we will publish tomorrow will assure him of that fact. We think that we can get the right blend by retaining Channel 4’s public service broadcast remit, which maintains its distinct and unique appeal, while enabling it to get the private sector capital investment that it requires to deal with some of the wider challenges presented by the likes of Netflix.

I appreciate what my hon. Friend said about changes in subscriptions. I think that underlines the volatility of the market and the need to be able to compete and invest in content. That is incredibly important. If Channel 4 is to remain uniquely appealing, we need that investment in content, and we believe that the reforms will give it greater sustainability going forward.