MPs try to muzzle media regulator: Fears that 'sinister' plans to transfer powers from Ofcom to Government will put diversity and quality in jeopardy

The Government is planning to remove crucial powers from the media regulator, Ofcom, and hand them to the Secretary of State for Culture. The move, which the Government insists is to improve efficiency, has been described by critics as "sinister".

Peers from both sides of the House of Lords are planning to scupper the proposals, which they believe could have damaging consequences for the future of British television. The proposals would leave broadcasters subject to fewer checks on the quality of their output. There is also concern that the weakening of the regulator in favour of greater political control is ill-considered in the wake of Lord Justice Leveson's recent inquiry into the news industry, which examined links between ministers and media businesses.

The plans are particularly controversial as they come at a time of potential change in the television landscape, with media mogul Richard Desmond known to be seeking prospective buyers for his Channel 5 network.

The Draft Public Bodies (Modification of Functions of Ofcom) Order 2013, which is due to be debated by both Houses of Parliament but will come before the Lords next month, is designed to reduce expenditure and improve efficiency at the broadcast regulator, which has suffered substantial recent cuts to its budget.

The Conservative peer Lord Inglewood, who is chair of the House of Lords Communications Committee, said members of the committee will oppose the plans when they come before the Upper House on 4 March. He described the plans to transfer powers from the regulator to the Secretary of State as "sinister" and a "step in the wrong direction".

"This discretionary power in the hands of the Secretary of State is the wrong thing to do," he said. "The argument is to save public money, but it doesn't seem to me it will make much difference. There are certain things in the interest of free and proper media that you have to do, and they do cost a bit of money but they should still be done."

The Order has potentially damaging consequences for future quality standards at public service broadcasters (PSBs) ITV, Channel 4 and Channel 5. Under the plans, these channels would only be subject to reviews every 10 years, instead of in the current five-year-cycle.

It is feared that such infrequent assessments will make it impossible to properly judge the value of the BBC's provision of key public service programme areas – such as news and current affairs and children's programmes – because of the lack of information about the other PSBs. Peers believe this could affect the BBC's new Royal Charter and licence fee settlement, which is due at the end of 2016.

Lord Stevenson of Balmacara said he and other Labour peers would be seeking to block the Order with a Fatal Motion.

"To my mind, the most worrying proposals from the Government are those that return responsibility for initiating reviews of public service broadcasting, and for any change of control of a Channel 3 or Channel 5 licensee, from Ofcom to the Secretary of State," he said.

Mr Desmond, who owns the Daily Express and Daily Star newspapers, is looking for a £700m buyer for Channel 5, which he purchased in 2010 for £103.5m.

The future of ITV was the subject of major controversy in 2007, when the satellite broadcaster BSkyB under then chief executive James Murdoch bought a 17.9 per cent share in the PSB. Ofcom carried out a review and raised "public interest" concerns which contributed to Sky having to reduce its stake.

Lord Stevenson said that such important matters should be the subject of proper scrutiny. "After Leveson, and in the run-up to a BBC Charter Review, proposing a novel form of secondary legislation to return these highly sensitive policy issues to political control seems very questionable indeed."

Ofcom would also be stripped of responsibility for promoting greater diversity in the media, an issue that has been raised recently by the actor Lenny Henry.

A spokesperson for Maria Miller, the Culture, Media and Sport Secretary, said the Order was designed to improve the efficiency of the regulator: "Any potential changes would be in order to assist Ofcom in carrying out their regulatory duties effectively and efficiently."

Ofcom has already reduced its budget in real terms by 36.9 per cent since 2010-11, following the Treasury Spending Review. An Ofcom spokesperson said: "Any decisions to change Ofcom's statutory duties and functions are matters for Parliament."

The Order can be defeated by either house and is likely to face hostility in the Commons. The shadow minister for Culture, Helen Goodman, said that the recent controversy over Channel 4's Benefits Street showed that PSBs needed frequent reviews. "Abandoning the five-yearly review, and not monitoring what public service requirements are being made, risks a decline in broadcasting standards," she said. "That would be bad for viewers and, in the long run, would be bad for the industry."