Channel 4 goes into battle with celebrity chef Jamie Oliver over junk food advertising
Channel 4 has warned that moves backed by its celebrity chef presenter Jamie Oliver to ban junk food advertising before the 9pm watershed are a "serious financial risk" for commercial broadcasters.
Chief executive Alex Mahon called on the Government to carry out a "full and open consultation" on any changes to the rules that govern advertising for foods that are high in fat, sugar or salt amid fears that restrictions could be rushed through by Downing Street.
Mr Oliver and other campaigners are urging Theresa May to ban junk food advertising before the watershed over claims it contributes to rising childhood obesity.
Broadcasters are opposing the campaign with claims that the policy would not be effective, that advertisers would simply shift spending to unregulated online services such as YouTube, and that it would damage their ability to invest in programming.
Jonathan Allan, Channel 4's commercial chief, said a "worst case scenario" ban would wipe £200m off total commercial television income. ITV would be hit hardest and lose an estimated £120m in advertising. It is understood that Channel 4 would face a blow of around £40m, with the remainder accounted for by smaller players such as Sky and Viacom, the owner of Channel 5.
Mr Allan said: "Jamie is obviously free to have his agendas. We feel the 9pm watershed is probably not proportionate as it would stop HFSS advertising in shows that don't appeal to kids at all - Countdown for example.
"It may also not be effective and potentially anachronistic in a world where children are watching on demand and at any time of day. A time-based watershed is not very effective.
"The amount of advertising exposure on TV has gone down over the last eight years because of regulation but also because of children watching video in other formats. But obesity has risen."
Ms Mahon said: "If that money wasn't on mainstream television, it would possibly go digital and target young people even more specifically.
"None of us want childhood obesity in the UK. We're just saying on this particular thing it needs a slightly more complex consultation."
The Government is expected to publish proposals in the coming weeks.
Channel 4 sought to defend its position as its annual report revealed mounting concern about the advertising market. It said it had arranged a £75m revolving credit facility with banks to provide flexibility and supplement its £190m cash reserve in case Brexit or other potential shocks hit spending next year.
Channel 4 revenues were down 4pc last year to £960m as advertisers took a more cautious approach. The non-profit broadcaster, which is state-owned but commercially funded, reported an overall deficit of £17m, dipping into its cash reserves.
Ian Katz, the former BBC and Guardian executive brought in by Ms Mahon to overhaul the schedule, said programming budgets would be cut in some areas this year and increased elsewhere to make Channel 4 more distinctive and topical.
The broadcaster now plans to join forces with the BBC to push the Government to introduce new laws to guarantee their prominence on Sky Q, smart TVs and other digital services where their traditional slots at the top of channel guides are less valuable. The pair will urge Mr Hancock to introduce laws as part of a legal clampdown on tech giants later this year.
Ms Mahon said: "We're in a position in the UK where our democratic values are being eroded. That's why we need to argue for a change in the prominence of public service broadcasting."