Minister of Information and Broadcasting Smriti Irani has withheld funds earmarked for Prasar Bharati after the latter refused to pay Rs 2.92 crore as fees to a private company, The Wire reported on Thursday. The ministry has not released any money since December 2017, forcing the public broadcaster to depend on its contingency funds to pay the salaries of Doordarshan and All India Radio employees, the report said.

On Friday, the government described this report as “defamatory” and “sinister”. The Press Information Bureau issued a clarification claiming that any autonomous organisation such as Prasar Bharati that receives grant-in-aid from the government must sign a Memorandum of Understanding with the ministry clearly describing physical and financial targets with timelines for activities to be done by utilising the money during that financial year.

“For the record, irrespective of repeated reminders from the ministry, no MoU has been signed by Prasar Bharati,” the statement said. It did not, however, deny the claims of Surya Prakash, the Chairperson of the Prasar Bharati board, that the funds had been withheld.

Prasar Bharati was allotted around Rs 2,800 crore in the 2018-’19 Union Budget. This money is released on a monthly basis by the I&B ministry. Prakash told The Wire that they had to pay staffers’ salaries for January and February out of a contingency fund. The broadcaster will run out of money by April if the problem is not resolved, he added.

Differences between the Information and Broadcasting Ministry and Prasar Bharati cropped up over payments to a private firm that covered the opening and closing ceremonies of the 2017 International Film Festival of India, the Wire report said. Doordarshan refused to pay Rs 2.92 crore to Mumbai-based SOL Productions Pvt Ltd, which arranged for live coverage of the ceremonies. Doordarshan’s objection is that there was “no rationale nor any precedent” to outsource the coverage when they had the “in-house” capability to telecast ceremonies live.

The ministry has been at odds with Prasar Bharati over its autonomy, especially over the recruitment of employees. In February, the public broadcaster’s board rejected two proposals made by the ministry, saying accepting them would “amount to infringing [its] autonomy”.

One of the proposals was to appoint a serving IAS officer to the vacant position of a full-time member on the board through the Union Cabinet’s Appointments Committee. The board felt doing so would give the ministry a window to intrude into Prasar Bharati’s affairs.

The board also dropped the resolution to appoint journalists Siddharth Zarabi and Abhijit Majumder to head news operations because the proposed salaries for them were “too exorbitant”.

Corrections and clarifications: The headline of this article has been updated to include the government’s reponse.