5 April 2022

The case for privatising Channel 4 is deeply unconvincing

By

Channel 4 is rather unlucky in its champions. Claims that independent artists in the regions would no longer get commissions if the broadcaster was privatised, for example, are deeply unconvincing. Meanwhile, arguments that an end to public ownership is the first step on the road to fascism are plainly ludicrous. But that doesn’t mean that Culture Secretary Nadine Dorries’ announcement on privatisation is a wise decision.

First of all, Channel 4 is doing a good job. As a a publicly owned but privately operated non-profit organisation, it has a statutory duty to broadcast independently produced shows with educational content and appeal to a diverse audience. Although one can quibble about the extent to which it sticks to this remit as opposed to chasing ratings – the less said about Naked Attraction the better – it is clearly doing something right. According to it’s 2020 annual report it had  ‘record financial surplus of £74 million’, with ‘resilient’ revenues revenues despite the impact of the pandemic.

Proponents of privatisation argue that we don’t need another public service broadcaster when we have the BBC. This misses the point. Channel 4 was introduced by Margaret Thatcher to provide competition to the BBC by developing a ‘distinctive character’ away from the mainstream. Although the BBC does provide many great shows, it’s hard to imagine it producing anything as challenging and unique as the award winning drama about the Aids crisis, It’s A Sin. Channel 4 continues to push the boundaries by broadcasting groundbreaking and important content – all without costing the taxpayer a penny.

This brings us onto the business case. Given it’s not publicly funded and is in good financial health under the current model, it would seem there is not much sense in privatising it. In fact, successive governments (including Conservative ones) have reached the same conclusion.

It’s also, frankly, a waste of time. The country is about to face the most severe cost-of-living crisis for generations, with many more people being plunged into poverty. There is the ongoing war in Ukraine. And let’s not forget the fallout from Brexit. These are the things the Government should be focussing on, not privatising Channel 4. Moreover, there are countless other areas of the public sector which need reform such as education, health and social care, and welfare. These will require significant time and political capital – both of which will be wasted in pursuit of a policy that few voters are particularly exercised by. It looks like any legislation would struggle to get past the Lords, and some well-respected Tory MPs, including Tom Tugendhat and Jeremy Hunt, have already made clear they are not on board.

So, given the weak business case and the effort it will take to get this through Parliament, why is the Government bothering?

One reason might be that it simply doesn’t like Channel 4. This is understandable, but hardly a great basis on which to make policy. Yes, Channel 4 news might have a left-wing slant, but if privatisation is an attempt to silence it, that suggests a government that is rather insecure and not very conservative. You can hardly imagine Thatcher, for example, refusing to be interviewed on Channel 4 in order to avoid being asked difficult questions. She no doubt would have been confident in her policies and would want to make the case for them to different audiences.

Ultimately, while the channel is far from perfect, it’s doing perfectly well as it stands. If you don’t like its output, there’s a very simple solution – don’t watch it. And until the Government can come up with a valid reason to change Channel 4’s status, it should stay in public hands.

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Ben Ramanauskas is a Research Economist at Oxford University and a former adviser to a government minister.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.