RTÉ looks to public funding as commercial income falls

The Government has "big choices" to make on the future of RTÉ, director-general Noel Curran has said, as he signalled the broadcaster's desire to collect a greater proportion of its funding from public sources.

RTÉ's deficit for 2012 will exceed €60 million, mostly due to the cost of restructuring the organisation, Mr Curran told The Irish Times.

Commercial income is understood to have fallen €14 million or about 8 per cent last year, with the advertising market remaining subdued in 2013. This has put pressure on RTÉ’s financial recovery as it seeks to break even this year.

“We’re not getting any licence fee increase, so we’re being eaten. Public funding is being eroded by inflation every year. We lost €10 million [in public funding] in the budget at the end of 2010 and our commercial income is also in a very difficult market,” he said.

Mr Curran added that the broadcaster was “prepared to countenance things that we have never countenanced before” and hinted this might include a reduction in commercial activities. “We are happy to see the balance of commercial and public funding alter. But we need some security.”

BAI recommendations

His comments coincide with the Broadcasting Authority of Ireland's review of public service broadcasting in Ireland. The authority will outline its recommendations on the future of media funding to Minister for Communications Pat Rabbitte as early as next week.

Mr Rabbitte has already announced plans to replace the licence fee, which is tied to television ownership, with a universal household broadcasting charge and indicated that a more efficient collection mechanism could generate a higher level of income without the need to increase the rate.

Mr Curran said there was “massive evasion” of the €160 licence fee and placed the rate for 2012 at under 17 per cent.

RTÉ has told the BAI it will “open up” its Montrose campus in Dublin to other companies, including digital technology firms and media production partners, while any additional funds raised from the proposed new charge will be shared with independent content producers, Mr Curran said. In exchange for a higher level of public funding, the statutory minimum amount RTÉ must spend on programmes commissioned from the independent sector could be raised, he suggested.

Last year’s deficit

Most of the 2012 deficit relates to a restructuring charge incurred as a result of payouts to 270 employees who left RTÉ last year. The deficit is higher than the Minister’s previous estimate of €57 million because more employees than expected availed of the redundancy package. Some 370 employees have left RTÉ over the course of 2011 and 2012.

The board of RTÉ gave initial consideration to its 2012 accounts at a meeting last Friday. Mr Curran said the figures, due to be published in the summer, showed “a massive turnaround” in its finances. “It is our goal to break even this year and that still remains our goal. It just depends where the commercial market goes. If the market plunges, then obviously we will have to sit back and reassess.”

Commercial revenue at RTÉ has fallen about 38 per cent since 2007, with the largest component – TV advertising – falling about 45 per cent.