Channel 4’s chief executive is in line to receive a bonus of almost £500,000 despite being in charge of the station as it lurches towards financial collapse.

Andy Duncan is poised to receive the loyalty payment of up to £450,000 next summer, taking his total remuneration to more than £1m. Details of Duncan’s pay emerged as ministers discussed handing over to the channel BBC assets such as Radio Times and the commercial rights to programmes from EastEnders to Sir David Attenborough’s documentaries, to fill an annual shortfall of £100m.

A merger with BBC Worldwide, the commercial arm of the BBC, would hand the station resources built up by generations of licence-fee payers.

The profits from BBC Worldwide contribute the equivalent of £9 per licence payer to the corporation. If this revenue is handed to Channel 4, the BBC will either have to increase the licence fee by an equivalent amount or cut programming.

John Whittingdale, chairman of the Commons culture, media and sport committee, said: “I am reluctant to single out any one executive, but if Channel 4 is to receive state aid it is only right that its executives share some of the pain.”

Duncan last year earned £400,000 more than Mark Thompson, director-general of the BBC, with a total package of £1.2m.

Channel 4, which is state owned but commercially funded, said this weekend that Duncan had agreed to accept a pay freeze next year and would forgo a second, performance-related bonus worth up to 30% of his £650,000 salary. They refused to comment on whether he would accept the £450,000 loyalty bonus.

Channel 4 predicts the shortfall in its funds will grow by an annual £150m a year after 2011, largely because of a sharp fall in advertising revenue.

Under Duncan, Channel 4’s viewing share has fallen from 9.6% to 7.8%.

Rupert Gavin, the former chief executive of BBC Worldwide, described the proposed merger as “a ludicrous suggestion”.

Peter Bazalgette, who used to head the production company behind Big Brother and Deal or No Deal, said such a merger would create a “bugger’s muddle of a business”.

A spokesman for Channel 4 defended Duncan’s remuneration, saying the channel “recruits its executives from a very competitive market”.

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