Page last updated at 18:56 GMT, Tuesday, 8 December 2009

Michael Grade says ITV is the victim in battle with STV

Michael Grade
Michael Grade said the problems with STV should have been talked through

ITV boss Michael Grade has claimed his company is the "victim" in the ongoing dispute with STV.

The Scottish broadcaster has dropped some network programmes, including The Bill and Doc Martin.

Relations between the firms are now badly strained with both suing each other for more than £30m.

Mr Grade told Westminster's Culture Committee this was a sad state of affairs and said STV was not adhering to its contact with the network.

ITV is suing STV for £38m, saying it is in breach of network agreements by dropping programmes. STV has counter-sued for £35m.

STV claims it is owed money by ITV and is also unhappy about promotional plugs for some of ITV's other businesses, such as the website, during programmes.

Mr Grade claimed the dispute was about STV "saving cash" and told Scottish Labour MP Rosemary McKenna, a member of the committee, it was a sad state of affairs.

He said: "It's just a shame that if they have got a cash problem, if they have, they did not sit down with us at the beginning as you would do if you have got 'an onerous contract'.

STV logo
ITV is suing STV for 38m - the Scots broadcaster is counter-suing for 35m

"You go and talk to the people. We're partners in the business, we should have sat down."

An STV statement said Mr Grade's comments had "no resemblance to the facts".

It said: "STV has a clear strategy, driven by a strong and dedicated leadership team which has sought dialogue with ITV for over a year, but ITV has refused to engage with this.

"We are a robust and vibrant business and are operating clearly within our rights, but ITV continues to act in a prejudicial manner and we will continue to vigorously defend our position."

Since the summer, STV has not broadcast the vast bulk of ITV network drama. As well as The Bill it has dropped the new episodes of Midsomer Murders and the acclaimed drama, Collision.

STV has said its strategy was about creating an "affordable and relevant" schedule for Scotland. It has replaced some of the dramas with Scottish factual programmes although other slots have been filled with repeats and old films.

However, STV's ratings have fallen. Its audience share in Scotland is now lower than ITV1's share in England, Wales and the Borders for the first time ever.

Ratings suggest that up to 140,000 Scots are watching programmes such as The Bill on ITV1 London on satellite and cable although STV insisted it was not worried about this fact and was more concerned about competition from other commercial broadcasters.

The company accepted that some of its decisions had not worked but said its new strategy was still in its early stages. It said viewers could look forward to a richer and more diverse schedule next year.

STV's share price is currently close to a record low. At midday on Tuesday, the share price was 49.5p and the whole company was worth less than £18m.

ITV owns all the former regional stations in England and Wales, such as the broadcasters once known as Granada, Yorkshire and Central.

Only STV, UTV in Northern Ireland and tiny Channel TV in the Channel Islands remain independent.

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