Production companies will be able to bid for a share of the money being made available by the Culture department in the first project of its kind specifically aimed at youngsters’ television.

The first awards are due to be made in 2019 and will fund up to half the production and distribution costs of new shows.

It follows a decline over the last decade in UK children’s TV output.Spending on the market by commercial Public Sector Broadcasters - ITV 1, Channel 4, Channel 5 and S4C - has dropped by £55million over the last decade.

Details of how the fund will work will be set out next year but it is expected to be targeted at free-to-air and potentially online rivals to the BBC which last year accounted for nearly 90 per cent of all first-run UK-originated children’s programming in the public service sector.

It is hoped that small independent companies, and programmes made in the UK’s nations and regions, will particularly benefit.

Culture Secretary Karen Bradley said: “High quality children’s television is not only entertaining but plays a vital role in stimulating learning and giving young people a greater understanding of the world around them.

“This significant investment will give our world-renowned television production sector the boost it needs to create innovative content for a wider audience that would otherwise not be made."

The cash comes from money left unspent under the last BBC licence fee settlement and will be allocated over three years as part of a pilot starting in 2019.

The Government already tax relief to UK children’s programmes.

Next year TV regulator Ofcom will publish its conclusions on whether and how to use its new powers to require broadcasters to carry a minimum amount of children’s programming.