S4C warns digital funding gap threatens production jobs

Dan Milmo
guardian.co.uk, Tuesday 6 December 2005 07.08 GMT

S4C, the government-funded Welsh-language broadcaster, has warned that it could face a multi-million-pound funding gap by 2009 if it does not receive further subsidies for digital broadcasting and new media ventures.

The warning follows a similar call by Channel 4, the publicly owned broadcaster, which said last year it might need financial assistance to plug an estimated £100m deficit by 2012.

Iona Jones, the newly appointed chief executive of S4C, said jobs would be at risk in the Welsh independent production sector without the extra support. The sector has benefited from an overhaul of the way S4C commissions programmes and employs at least 3,000 people.

Ms Jones told the Guardian that the relationship with producers would be eroded without extra funding to subsidise S4C's contribution to switching off the analogue TV signal in Wales and to assist the move into new media, such as broadband internet.

"It would undermine the creative sector in Wales. The whole infrastructure would be under threat," she said.

It would also be a backwards step for the Labour government's devolution policy and for the Welsh Assembly, which is expected to gain more powers under the Better Government for Wales bill, she said. Ms Jones will outline her case today at a Commons select committee inquiry into the cost of the digital switchover.

S4C's main source of funding is an annual grant of £86m from the Department for Culture, Media and Sport, supplemented by programming worth £22m from the BBC and about £10m from commercial sales. The broadcaster is at a critical point in its 23-year history as it prepares to switch to showing programmes only in Welsh when the analogue signal is switched off in Wales, in 2009. Its analogue schedule is supplemented by Channel 4 programming that brings in viewers and advertising. As soon as Wales goes fully digital S4C will need to replace the Channel 4 programmes with more Welsh-language shows.

Ms Jones added that the cost of financing the switch to digital, involving the conversion of more than 100 broadcast masts, would "jeopardise" programme investment. "I will be looking for further financial support, either directly or indirectly. That may or may not be the BBC or the government," she said.

Ms Jones said the size of the funding gap would depend on how much assistance S4C received for the digital switchover. The broadcaster is also seeking to secure its financial future by thrashing out a new partnership agreement with the BBC, which supplies it with 10 hours a week of Welsh-language programming. Ms Jones said the discussions with the BBC, which could yet be asked to subsidise S4C's digital costs on top of the new agreement, were "very positive".

"It could form the basis for an innovative strategic partnership," she said.