Government expected to sell Channel 4 as public ownership 'holding it back'

The government is to proceed with plans to sell Channel 4, arguing that public ownership is holding C4 back from borrowing or raising investment capital.

C4 described the decision as "disappointing" given the public interest concerns raised during the consultation, but ministers have said the new owners will have to pass a "fit and proper persons test" and they will have to ensure Channel 4’s contribution to public sector broadcasting.

Ministers said they had decided that government ownership is holding Channel 4 back and that a sale of the brand would "modernise" the UK's public service broadcasting sector.

This is a deeply politically controversial move and there will likely be a considerable dispute over it in Parliament, as Political Correspondent Carl Dinnen reports

The belief that Channel 4 would be sold off has grown in recent months, and a government source has said ministers will "seek to reinvest proceeds of the sale".

A government source added that a change in ownership "will remove its straightjacket".

A spokesperson for Channel 4 added it was "disappointed" with the decision but would "continue to engage" with the government on the process to "ensure that Channel 4 continues to play its unique part in Britain's creative ecology and national life".

In an internal email to staff, Channel 4 Chief Executive Alex Mahon said her priority was to "look after all of you and the wonderful Channel 4 spirit".

She said: "In our engagement with government during its extended period of reflection, we have proposed a vision for the next 40 years which we are confident would allow us to build on the successes of the first 40.

"That vision was rooted in continued public ownership, and was built upon the huge amount of public value this model has delivered to date and the opportunity to deliver so much more in the future.

"But ultimately the ownership of C4 is for government to propose and Parliament to decide."

Listen to Unscripted, the arts and entertainment podcast from ITV News