The BBC is moving worrying close towards becoming an “arm of government”, a former chair of the Corporation has said.

Sir Christopher Bland, who chaired the BBC between 1996 and 2001, said the Chancellor’s plan to offload spending priorities onto the broadcaster could have consequences for the broadcaster’s relationship with the state.

“Rather subtly and unattractively it draws the BBC closer to becoming an arm of government which is always something that the BBC and government have resisted,” he told BBC Radio 4’s World this Weekend programme.

“It’s the worst form of dodgy Whitehall accounting. It’s transferring social policy onto the licence fees and it’s shifting from direct taxation where it properly belongs the cost of a Gordon Brown giveaway that was doubtful in the first place anyhow.”

Sir Christopher was commenting on a proposal by George Osborne to make the BBC fund free TV licences, a policy that is usually funded from general taxation.

Former BBC chairman Sir Christopher Bland (Rex)

The move follows the transfer of the cost of the BBC World Service and BBC Monitoring to the Corporation. It amounts to shifting £650m from the Government's Budget to the BBC.

The complaint comes the week after the Government asked the Corporation to change the way it reported stories about the militant group Isis.

Chris Grayling, a member of the Cabinet and leader of the Commons, said the broadcaster should start referring to Isis as ‘Daesh’ – a disparaging Arabic term.

He said the BBC should take the side of the UK in international conflicts.

“During the Second World War, the BBC was a beacon of fact, it was not expected to be impartial between Britain and Germany,” he told parliament.

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George Osborne justified the accounting change on the basis that the BBC was under public control.

“The BBC is also a publicly funded, public institution and so it does need to make savings and contribute to what we need to do as a country to get our house in order,” he told the Andrew Marr Show.