Dear Michelle Donelan,
Congratulations on your appointment as Secretary of State for Digital, Culture, Media and Sport. You must be all too aware that two of the key issues you have inherited with the office are the privatisation of Channel 4 and the question of the future of the BBC licence fee. The government under Boris Johnson already this year announced its intent to sell Channel 4, while your predecessor, Nadine Dorries, suggested that a new funding model would be found for the BBC once its current royal charter expires in 2027.
There are opinions and arguments aplenty on both sides of the fence, and it is a surprise to nobody that the Conservative party seeks to privatise remaining public assets and limit the power of a national broadcasting service that is both politically independent and publicly funded. Moves like this are of textbook Tory ideology to such a degree that other readers of this letter are likely wondering why I would even bother writing to you with other perspectives.
The answer is that I would like to believe that some politicians are humans, not mere idealogue robots, and you might be able to see that any private gains to the powerful private interests your party represents, or indeed to the private sector in the abstract, are really not worth the damage you would cause to overall public interests in rolling out particular policies. It’s also the case that the pursuit of a given Conservative ideal can actively conflict with other ideals your party holds and undermine achievements it has made, and I suggest that is the case here.
In this letter, I’d like to focus on Channel 4. There are very limited economic arguments for its privatisation beyond the sum raised by the sale itself. The channel receives no public funding, as it pays for itself through advertising. Despite somewhat diminishing advertising revenues, there is no need for further private investment and C4 itself does not want to privatise, calling the decision “disappointing”. It has presented its own plan to the government that it considers “an attractive, realistic and sustainable solution” to keeping C4 in public ownership and continuing to evolve its independent programming.
The financial argument for privatisation is mostly based on the premise that the company could borrow more and produce its own programs, which would allow it to profit from the rights globally and make programs for other networks. But this notion runs counter to the very culture of independent programming that makes C4 what it is. The Thatcher government created Channel 4 to allow a younger generation of producers to surface their ideas and to stimulate a culture of entrepreneurialism in independent production. And that is precisely what it has achieved, and more. It stands among the greatest accomplishments of Thatcher’s office; does today’s Conservative government really want to lobotomise it?
C4 is difficult to value, as it has limited tangible assets and outsources its programming to independent production companies, but some have suggested £1bn. With annual government spending in excess of £800bn, this one-off revenue is a drop in the ocean. But the implications of its sale into private hands are far greater.
Trade body Pact has estimated the sale to cost £4.2bn to the country’s independent film and tv sector. This is because a private buyer would consolidate in-house production and commission far less from independent production companies. That in turn would stifle the creative range of bold, challenging and original programming that defines the very culture of C4 and underpins its success, quality and and popularity. The channel won almost a third of the prizes at the most recent Edinburgh TV awards, which is a hard record to argue with; the formula works as it is.
A greater focus on in-house production would also reduce the scope of geographical diversity, making production more centralised in London at the expense of the other regions of the UK, including the nations beyond England. Saoirse-Monica Jackson of the tremendously successful show Derry Girls has said publicly that the show and others like it “would not get made” under a privatised C4. So, even if the full revenues from the sale were to be ‘reinvested’ into independent production, this would be greatly outweighed by the overall costs to the industry, and would likely narrow the scope of commissioning too.
Further, senior figures at C4 believe that privatisation would also undermine the quality of its news provision, given than in-depth news is costly to produce and that news occupies prime slots in the programming. Others in the broadcasting industry are concerned that other areas of production, including current affairs and drama, are also relatively less commercial than other areas, so would take a hit under a new private owner. These are not concerns that should just be brushed under the carpet, but rather they are vital to assessing the impacts on public interests.
I would urge you to conduct a thorough, formal review of the implications of the sale, listening to the voices of experience in the industry, as well as considering the alternatives to privatisation that could strengthen, rather than dismantle, all that makes C4 great.