Confirmed: Channel 4 privatisation cancelled as broadcaster to stay in public ownership
Channel 4 will remain in public ownership after a planned privatisation – championed by Boris Johnson’s government – was binned today.
The Culture Department confirmed the move today, confirming reports based on a leaked letter yesterday.
The Culture Secretary Michelle Donelan had written to Rishi Sunak calling for the government to drop the plans to privatise Channel 4 as part of a Cabinet write-round.
While Channel 4 is commercially funded, it is publicly owned. As part of the Media Bill, Boris Johnson had pushed for the privatisation of the channel, with previous Culture Secretary Nadine Dorries adamant on the sale.
However Donelan – who took the job in the summer after Johnson and Dorries’ resignations – said that after “reviewing the business case, I have concluded that pursuing a sale at this point is not the right decision,” in the letter.
City insiders had suggested the channel could be sold for around £1bn, with JP Morgan at one point offering corporate financial advice.
Today Donelan said Channel 4 is a “British success story and a linchpin of our booming creative industries.”
The Johnson government had considered selling off the free-to-air public broadcast television network in an attempt to “thrive in a rapidly changing media landscape.”
Sunak had previously supported the privatisation saying that the channel needed a commercial owner to help it compete with streamers like Netflix – though according to reports his Cabinet now views the potential privatisation as unnecessary.
Donelan is set to introduce a new statutory duty on Channel 4 board members to ensure the company’s financial sustainability.
Channel 4 will also be given scope to produce its own content.
The move will allow Channel 4 to create more original content and move staff out of London.
She added that the move is “likely to be popular with parliamentarians, particularly those who raised concerns about the effect a sale of C4C may have on the UK’s system of public service broadcasting.”
The move will see the production industry breathe a sigh of relief, with Channel 4 one of its key clients.
– a trade association for producers – said the u-turn was the right decision, with privatisation “a solution in search of a problem that didn’t exist.”
“Moving to private ownership,” he said, would have “endangered” a long-standing relationship between the channel and independent producers.