Doubt cast over future of STV news

Pilot schemes were to be run in some regions including the STV area

The future of Scottish news on STV is once again in question.

The UK government has said it would scrap a plan to give a group of newspapers public money to produce the channel's news.

Culture Secretary Jeremy Hunt confirmed plans for pilot projects in the STV area and some other ITV regions would not be going ahead.

The money will be spent on superfast broadband instead.

Mr Hunt's decision means that STV will have to keep on providing Scottish news at its own commercial risk. But some observers believe significant cuts may be proposed within weeks.

STV had argued for some time that it would not be able to keep providing its existing level of Scottish news coverage without public money.

The former Labour government agreed, so a contest to provide publicly-funded news was organised.

This was won by a consortium led by several major newspapers - but no contracts were signed.

STV said it had anticipated Mr Hunt's announcement but warned that there was nothing in his speech to deal with the economic challenges facing the station.

The big problem is that the commercial benefits of holding a Public Service Broadcasting licence such as STV's will soon outweigh the associated costs.

Weighing options

Some believe it will soon be viable for STV or ITV1 to give up their licences and broadcast, free from public service obligations, in the same way as most other commercial channels.

In a statement the company said Mr Hunt's announcement did "not address the acknowledged deficit in our Public Service Broadcasting licences with regard to news provision and we will therefore engage with both Ofcom and the Department of Culture, Media and Sport on this important matter as we consider our options going forward.

"Connecting with our audience at a local level is central to STV's future strategy and we would hope to participate in the proposed independent assessment of local television.

"We look forward to hearing more of the details and to engaging with the government on this in due course," it added.

STV currently provides two distinct news services - one for the historic STV area in the central belt and the West Highlands, the other for the former Grampian TV area in the north.

Its news programmes at 1800 also include local news opts-out.

For the moment, it is still legally required to honour these regulatory commitments.

Before STV could make any significant changes to these programmes, it would need permission from the communications regulator Ofcom.

If STV were to propose significant cuts - for instance ending the separate programme for the north - Ofcom would normally hold a full public consultation before deciding whether to allow such a move.