Commercial TV 'needs public cash'

Peers fear the BBC could dominate news and current affairs output

Part of the TV licence fee should be used to help commercial channels pay for news and public service programmes, a House of Lords committee has said.

As broadcasters face severe financial problems, the BBC could become too dominant in news and current affairs, the communications committee says.

The peers suggest a new fund be set up to grant help to commercial channels.

It could be created from an expected £130m surplus from a campaign aimed at helping people switch to digital TV.

A portion of the licence fee has been set aside to help older people and those with disabilities prepare for the end of the analogue signal in 2012.

Commercial advertising revenues have plummeted and in January media regulator Ofcom recommended Channel 4 merge with either Five or the BBC's commercial arm - BBC Worldwide - to plug a £150m funding gap.

However, the committee said a merger was not the way forward.

Refund option

Instead, committee chairman Lord Fowler called for more partnerships, such as that announced last month involving the BBC sharing regional news resources with ITV.

He said the proposed fund would offer "a more flexible solution than creating a new organisation with all the potential problems that involves".

The BBC Trust, which regulates the corporation, said it would only support proposals that did not compromise the corporation's ability to deliver public services.

There would be "a number of potential calls" on any surplus from the digital switchover fund, including the option of returning it to licence-payers, it said.