Donelan recommends dropping Channel 4 privatisation

Culture Secretary Michelle Donelan has written to Prime Minister Rishi Sunak recommending plans to privatise Channel 4 do not go ahead.

In a letter addressed yesterday (03 January), Donelan wrote she has “concluded that pursuing a sale at this point is not the right decision and there are better ways to secure C4C’s [Channel 4 Corporation] sustainability”.

She adds that Channel 4’s role in supporting growth in the UK’s independent production sector “would be very disrupted by a sale at a time when growth and economic stability are our priorities”.

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First tabled by Donelan’s predecessor Nadine Dorries, members of the arts and culture sector initially reacted to proposals to privatise the broadcaster as ‘cultural vandalism’.

During her first months as Culture Secretary, Donelan promised to review the business case of both selling Channel 4 and scrapping the BBC licence fee.

Her letter to Sunak includes request for clearance on a package of reforms proposed to support Channel 4’s long-term sustainability.

Labour Shadow Culture Secretary Lucy Powell has responded to the news, commenting: “The Conservatives’ vendetta against Channel 4 was always wrong for Britain, growth in our creative economy and a complete waste of everyone’s time.”

Chief Executive of independent producers association Pact, John McVay, said: “The government has made the right decision to hit the stop button on Channel 4 privatisation. It was always a solution in search of a problem that didn’t exist.”

Dorries reacted to the news via twitter, commenting “three years of a progressive Tory government being washed down the drain.”

Future reforms

Donelan’s letter proposes introducing a statutory duty on the C4C Board to have a clear focus on the long-term sustainability of the business.

It also suggests relaxing legislation that currently prevents the broadcaster from producing content for Channel 4, which would allow the broadcaster to make more shows in-house.

Another proposal suggests allowing Channel 4 to borrow more money from the Treasury above its current £200m limit, to “diversify its revenue more effectively”.

The letter also says C4C has agreed to increase its investment in skills and areas outside the capital. The broadcaster has agreed to double its number of roles based outside London in 2025 from 300 to 600, and will be increasing its investment in skills from £5m to £10m annually.

Donelan says she hopes to announce formal details of the package as soon as possible, which she expects “is likely to be popular with a majority of Parliamentarians, particularly those who raised concerns about the effect a sale may have on the wider creative economy”.

She has asked Sunak to respond to her reforms today (4 January).