The Government hopes next year's Commonwealth Games in India will be available on free-to-air television despite TVNZ saying it cannot afford to broadcast them.

TVNZ is negotiating with Sky to take over the broadcasting rights after it said it could not absorb the $5 million in losses it would take to air the event.

Sky has already said that if it does broadcast the event it will be available on free-to-air.

Broadcasting Minister Jonathan Coleman said TVNZ had made a commercial decision.

"I think it is still highly likely the Games will be available certainly on television, but most likely free-to-air as well," Dr Coleman said.

"TVNZ has been operating commercially for years. it has decided it can't afford to cover this event."

Dr Coleman said that cutting the dividend the Government expected from TVNZ would make no difference as it was not paying a large dividend this year.

"There is not a lot of money to go around and TVNZ's taking the measures that it needs to get its house in order financially and I think it is doing a good job of that."

Dr Coleman refused to say whether he would consider stepping in to force a broadcaster to show any sporting event on free-to-air television.

He said New Zealand had no legislation on the issue, but there was a good choice of sport on television, even if it was on pay television.

Sky spokesman Tony O'Brien said a proposal had been received from current rights holder TVNZ.

"If Sky is the successful bidder, as with the 2010 and 2012 Olympic Games, New Zealand viewers will be guaranteed comprehensive free-to-air coverage," he said.

TVNZ spokeswoman Megan Richards said the state broadcaster had been looking to offload broadcast rights after it was estimated it faced a loss of $5 million on the Games.

She said that in previous years it was possible to absorb this loss in the interest of keeping such international events on free-to-air channels.

"In this economic climate that's not something that's manageable for us. We have no reserves and no buffer any more."

Any deal would require the approval of the Commonwealth Games Committee in India which was expected to be sought in the next few weeks.

The New Zealand Olympic Committee said it was delighted that free-to-air coverage of the Games was assured if Sky took on the rights.