Ministers have been accused of missing a chance to make the BBC truly independent as they rejected calls for the corporation's charter to be axed.
The BBC's current charter will expire in 2006
The House of Lords charter renewal committee last year said the BBC should be put on a statutory footing, with more scrutiny from Parliament.
But on Tuesday the government said the public did not want Parliament to have more power over the BBC.
Lords committee chairman Lord Fowler called the news "deeply disappointing".
The BBC's current charter, setting out the corporation's role, functions and structure, is due to expire at the end of this year.
The government is due to set out proposals to renew the charter in a White Paper.
The Lords committee argued the government's plans would not reduce the BBC's "vulnerability to political pressure".
It pressed for the BBC to be established in the statute books so Parliament had a say on its constitution - a call previously echoed by the Commons culture committee.
But in its response to the committee's report, the government said the best way of ensuring the BBC's independence and stability was by another 10-year charter.
The alternative of using an Act of Parliament risked making the BBC more open to intervention from ministers, MPs and peers - and less flexible to change.
"The public does not want to see Parliament given an increased power over the BBC," says the government response.
Lord Fowler said he was disappointed but not surprised.
"The result is that the arrangements for the BBC over the next ten years will be settled in a deal between the secretary of state and the chairman of the BBC," said the Conservative ex-Cabinet minister.
"The government supports the continuation of the Royal Charter because they control it.
"This does not secure the independence of the BBC and is no way to ensure the proper oversight of nearly £3bn a year of the public's money the corporation receives."
The government also ruled against the Lords committee's proposals for having a single chairman of the BBC board, with a separate management committee headed by the corporation's director-general.
Instead, ministers are standing by their original plan for a new BBC Trust to represent the interests of licence fee-payers and protect the BBC's independence.
They also reject the peers' push for the estimated £400m cost of switching from analogue to digital broadcasting to be paid from general taxes, not the BBC licence fee.
The Department of Culture, Media and Sport said: "All licence fee payers will benefit from digital switchover - whether because of the extension of digital terrestrial coverage or from the development of new services from released spectrum."
The BBC last year said the licence fee to rise by 2.3% above inflation each year to boost its programmes and digital services.
The increases could take the licence fee to almost £180. It is currently £126.50.
The government has asked consultants to look at the BBC proposals and has said it will announce the outcome in due course.