A think tank with close links to the Conservative Party has called for an overhaul of public service broadcasting in the UK which would see state-owned commercial broadcaster Channel 4 privatised and the BBC ordered to make less high-cost light entertainment shows and to share 5% of its licence fee income with the commercial sector.

The Policy Exchange report, called Changing The Channel, looks at all public service broadcasting in the UK. Currently both the state-owned broadcasters - BBC and Channel 4 - have wide-ranging public service commitments, while both ITV and Five have some public service obligations in return for occupying one premium terrestrial channel each.

The report proposes freeing ITV and Five of all their public service broadcasting obligations pretty much immediately. A privatised Channel 4 would continue to have a public service remit, but would be able to bid for a pot of licence-fee money set aside by the BBC to fund public service programming on commercial networks.

All public service TV - so BBC, Channel 4 and any such programming on other networks - would be overseen by a new public service broadcasting regulator. This would replace the current BBC regulator - the BBC Trust - which critics have often argued has proven no more effective than the old BBC Board Of Governors in holding Beeb management to account because, some say, it operates too closely to those it is meant to regulate.

In its recentish 'Digital Britain' review of the UK broadcasting sector, the current government resisted calls from Channel 4 for a sizable helping of licence-fee money, but in return did not back any talk of the company being privatised, that being something C4 management do not support. Government proposals instead urged more collaboration between Channel 4 and the BBC's commercial division Worldwide, implying they'd be happy for said collaboration to go as far as merger.

Ministers have backed a very small amount of licence fee money going to fund some public service programming on commercial networks - mainly news - but have generally resisted the temptation to force the BBC into any major change in its operations or programming. Though political types on all sides have been critical of the BBC Trust.

Whether anything in the Policy Exchange report would actually influence relevant ministers in any new Conservative government remains to be seen, but its publication is likely to reignite chatter about a possible merger between Channel 4 and rival network Five, or may be even ITV, something much discussed in recent years, but less so since the publication of the 'Digital Britain' report last year.