The government tried to intervene to alter the wording of Channel 4’s annual report to fit its privatisation plans, according to the broadcaster’s chief executive.
Alex Mahon also told a committee of MPs on Tuesday that the broadcaster’s investigation into the culture secretary, Nadine Dorries’, claims that a 2010 Channel 4 reality show she appeared on used paid actors has found no evidence of fakery.
The government is seeking to privatise Channel 4, claiming it will struggle to survive in a media landscape increasingly dominated by big streaming companies such as Netflix, and has an overreliance on declining TV advertising to support its business model.
The controversial policy is opposed by Channel 4’s management and board of directors. They and the broadcaster’s independent auditors signed off on the annual report on 23 May but it is yet to be made public.
Asked about the delay to the publication of the report, Mahon said it had been held up by officials at the Department for Digital, Culture, Media and Sport.
“It is fair to say the DCMS made some comments that they would have preferred to see in the report, particularly about our future financial sustainability,” Mahon said, responding to questions from the DCMS select committee of MPs. “Really, the questions were about whether our wording was in line with government policy. It is the first time to my knowledge in [Channel 4’s] 40 years that there have been queries about the annual report.”
The government is pushing ahead with plans to privatise Channel 4, which has been signed off by the prime minister Boris Johnson, although these plans could be dropped by his successor.
“Management and the board view is Channel 4 is in a strong and sustainable position, it is also [our] independent auditor’s view,” Mahon said. “There was some concern from the DCMS, [which] would have preferred to change some wording. [They] have now agreed it can be submitted to parliament in the normal course without any changes. The report that will arrive is the one agreed by the board.”
Channel 4 reported a 25% increase in total revenues to a record £1.2bn last year, an 18% uplift on its pre-pandemic financial performance in 2019.
The broadcaster, which is publicly owned but fully commercially funded with a non-profit remit to provide distinctive and challenging programming, reported a record £101m “surplus” last year.
Channel 4 has £273m in cash reserves and £566m in net assets on its books, and has a target of making 30% of total revenues from digital operations by 2025.
A DCMS spokesperson said: “As the owner of Channel 4, the government is fully entitled to comment on the contents of its annual report.
“During the normal process of discussion we highlighted that some language in the report could be interpreted as going against the corporation’s commitment, given to both officials and ministers, to refrain from campaigning against privatisation.
“It is the government’s job to take a long-term view on how to best secure the most successful future for Channel 4 in a rapidly changing media landscape and we believe private ownership will give the broadcaster the tools to innovate and grow at pace.”
Mahon was also asked about an internal investigation Channel 4 had launched into the 2010 reality show Tower Block of Commons, in which Dorries was one of a number of MPs who went to live in deprived communities.
In May, Dorries claimed in front of the same select committee that the reality show used paid actors to play supposedly real people.
“An accusation of fakery was made about actors in the programme,” Mahon said. “We are just completing a proper investigation. From what I have seen, I don’t see any indications of that fakery.”
Mahon was asked if she had received any evidence from Dorries backing up the assertion of fakery as part of Channel 4’s investigation. “From what I have seen to date there is no evidence that would point to indications of fakery,” she said.
Asked whether she had heard from the DCMS regarding the investigation, Mahon said she has heard from the culture secretary “directly” and expected its conclusions to be published along with a DCMS statement later this week.
• This article was amended on 12 July 2022. An earlier version incorrectly referred to Boris Johnson as the “former” prime minister.
