Channel 4’s chief executive Alex Mahon has praised the Government for coming to a “sensible decision” after confirmation that the broadcaster will not be sold off.

On Thursday Culture Secretary Michelle Donelan confirmed the Government has scrapped plans to privatise the broadcaster and said Channel 4 will now be able to make and own some of its own content.

Speaking to Cathy Newman on Channel 4 News, Ms Mahon, 49, said: “The Government has every right to look at the ownership of Channel 4 from time to time, perhaps not quite as frequently as it has been.

“But I think in the end the Secretary of State has thought through carefully what the numbers say, what do the facts say, what does the data say and has come to a good package of measures that are sensible and smart and sustainable.

“And that’s a sensible decision to come to.”

Unlike other broadcasters, everything the channel currently airs is commissioned from external production companies.

Ms Mahon said she was “delighted” with the new plans, despite concerns having been raised by Pact, the trade body for the independent sector, which warned the move could have “the same damaging outcome” on its members as privatisation if “effective protections” are not put in place.

The Government will legislate through the Media Bill to relax the publisher-broadcaster restriction, which currently prevents Channel 4 from creating content in-house.

The broadcaster’s flagship programmes are all currently made by independent production companies, with The Great British Bake Off coming from Love Productions and Gogglebox from Studio Lambert.

Responding to the concerns, Ms Mahon said: “Channel 4 has been integral to the success of the TV and film sector in the UK for 40 years.

“We’ve been about building the creative economy in the UK and the indie sector and I want to make sure we’re still part of that for the next 40 years.

“So the Government has announced that they want to remove the constraint that’s in place that stops Channel 4 producing programmes and I’m pleased that the Government has said it will engage properly with the sector to make sure that’s done in a way that is not damaging to the sector.”

Pact welcomed the Government’s decision to keep Channel 4 in public ownership but warned against new measures to allow it to create its own content.

Chairwoman Jane Muirhead said: “Whilst it is clearly the right decision by the Government to reverse the privatisation of Channel 4, the decision to allow Channel 4 to produce its own in-house programming has the potential to achieve the same damaging outcome, if there are not effective protections put in place.

“Pact will be meeting with Government and working closely with them to ensure that the right safeguards are established to protect the UK’s successful world-class indie sector.”

Broadcasting union Bectu welcomed the move to allow Channel 4 to create content in-house.

Its head, Philippa Childs, said: “Channel 4 costs the UK taxpayer nothing, yet gives us a thriving independent production sector, thousands of jobs and world-renowned, innovative content. We wholeheartedly welcome the Government’s decision to scrap these short-sighted and damaging privatisation plans.”

Ms Childs added: “We also welcome the opportunity for more commercial flexibility for the broadcaster and will be seeking to engage on how this might best be balanced with safeguarding its role in driving innovation and investment in independent production.”

Channel 4 has also agreed to enhance its support for the independent TV production sector and regional roles, doubling the number of roles outside London in 2025, the Department for Digital, Culture, Media and Sport (DCMS) said.

The reforms come as part of Ms Donelan’s decision to scrap plans to privatise the broadcaster, which had been announced under the tenure of her predecessor, Nadine Dorries.

The Culture Secretary said: “Channel 4 is a British success story and a linchpin of our booming creative industries. After reviewing the business case and engaging with the relevant sectors, I have decided that Channel 4 should not be sold.”

She added: “The package will also safeguard the future of our world-leading independent production sector. We will work closely with them to add new protections, such as increasing the amount of content C4C must commission from independent producers.”