An “out of control” BBC could kill local newspapers, the chief executives of the companies behind The Guardian and the Daily Mirror told MPs yesterday. Carolyn McCall, chief executive of Guardian Media Group, said that the Manchester Evening News, also owned by her company, could not match proposed BBC spending on local news sites in the present economic climate.

“The Manchester Evening News is fighting for its own survival, and that is not a dramatic statement,” Ms McCall told MPs on the Culture Select Committee yesterday. She added that it was unacceptable in a democracy to have “a strong BBC and nothing else” providing local news.

The remarks from the chief of GMG - a company normally closely supportive of the BBC - were echoed by Sly Bailey, chief executive of Trinity Mirror, who said that the BBC was “using public money to compete in public areas where it simply doesn’t need to be”.

She accused the BBC of trying too hard to “serve all audiences”, and “as a result of that I would say to you that the management is out of control and the trust is not in control”. Trinity Mirror owns regional titles in Liverpool, Cardiff and Newcastle.

Ms McCall feared that the licence fee-funded BBC, which proposes to spend £68 million, would be able to invest on a scale that would draw web viewers away from commercial sites, and could simply introduce video when it is still expensive for local newspapers to do so.

Publishers giving evidence before an inquiry into the scale and impact of the BBC’s commercial operations also complained that the broadcaster was straying from the legitimate exploitation of its own brands, such as Top Gear, by moving into non-programme-related activities, such as the £90 million purchase of a stake in Lonely Planet travel guides. Tony Elliott, owner of Time Out and competing travel guides, said there were “clearly problems with the structure and remit” of Worldwide, the BBC’s commercial division. However, he acknowledged that he had held talks about the BBC taking a stake in Time Out.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive