The diversity of our world-leading television production sector is one of the main reasons that it is so successful. We have companies of different sizes operating all over the UK, focusing on genres ranging from specialist factual to high-end drama and everything in between. Last year, these companies delivered the highest sector revenues on record: just under £4 billion. Smaller producers are, of course, hugely important for ensuring a healthy production ecosystem, and the current regulatory regime for independent production has been very successful indeed in promoting and supporting them. Boosting this independent sector was one of the purposes behind the design of Channel 4. I do not want to make the noble Lord, Lord Bassam, feel old, but I was not around to be a sceptic at the time of those debates—they happened before I was born. But Channel 4 has, as I have said from this Dispatch Box, done a great service over the last four decades, and the regulatory regime has supported that too.

PACT, the industry body, estimates that there are more than 250 independent producers with an annual turnover of less than £1 million operating in the market today. Its statistics also show that 75% of independent producers have an annual turnover of less than £25 million. These are the producers that the noble Viscount, Lord Colville of Culross, had in mind, particularly with his Amendments 14 and 15. The issue of providing further support for smaller independent producers is one that we have looked at closely, most recently through our work on the mitigations to accompany the removal of Channel 4’s publisher-broadcaster restriction, which noble Lords have noted.

The clear message from the sector when we did that was that the measures which singled out smaller producers specifically—for example, via a turnover threshold, as the noble Viscount’s Amendment 14 proposes—would not be welcome on the grounds that they would be anti-competitive and penalise success. Producers want an incentive to win more commissions and grow their businesses, not to stay small. Those we spoke to also raised concerns that such measures would be difficult for Ofcom to enforce and could lead to increased monitoring and compliance costs for the regulator. Although these issues are addressed in part by the additional flexibility which the noble Viscount offers through his Amendment 15, the overarching concerns that we have with this approach still stand.

The Government recognise that this is a challenging time for producers and the production sector because of the slowdown in commissioning activity as a result of the downturn in the television advertising market, and we are taking steps to support producers and the production sector at this time, including the generous tax reliefs across studio space and visual effects, investing in studio infrastructure, supporting innovation and promoting independent content through the UK Global Screen Fund, but, for the reasons I have set out, we do not feel that we are able to support the amendments which the noble Viscount has put before us, but we are grateful for the opportunity to have this debate.