Report on RTÉ barter accounts raises fresh questions about commercial division

RTÉ spending on sports junkets and entertaining clients was “not subject” to internal controls, a government review has found in conclusions that raise fresh questions about the broadcaster’s commercial division.

The review by accountants Mazars followed political uproar over RTÉ “barter account” spending of some €1.6 million on sports and concert tickets, restaurants, flights and even flip-flops for party guests.

As Minister for Media Catherine Martin suggested the accounts may have been used to hide certain purchases, she complained of “alarming gaps” in RTÉ's procedures.

“It definitely raises questions there, as to was it being used to avoid proper oversight to hide certain purchases, that’s what we can see here,” the Minister told reporters as she published Mazars’ interim report.

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“It looks that way, but I have to wait until the final report which will be the first week of October.”

A barter account is a type of trading account in which media groups such as RTÉ use advertising slots to pay for certain goods and services. One account with a UK barter agency was used to conceal RTÉ payments to former star presenter Ryan Tubridy, setting off investigations that led to claims the accounts were being used for “slush fund” spending.

[ Report confirms RTÉ’s use of barter accounts was very, very loose ]

[ RTÉ staff must make disclosures for register of interests or else face sanctions, Minister warns ]

Although RTÉ argued at one point last month that it was “entirely legitimate” to use the accounts for corporate hospitality, Mazars said the broadcaster did not appear to have “a formally approved policy and procedure” for making purchases from the accounts. The accountants had “not identified any benefit to RTÉ” from using barter agencies.

“Mazars noted that purchases made through barter media agencies are not subject to budgetary controls or (monthly) budgetary reporting and the annual budget of RTÉ does not include a specific category designated for purchases through barter media agencies,” the report said.

“RTÉ informed Mazars that certain key personnel within the RTÉ commercial division have access to request purchases through the barter trade credit account. Mazars notes that this is not formally documented or agreed within a policy or procedure.

“Additionally, based on our initial analysis and through discussions with RTÉ, other staff not referred to as the authorised users may have on occasion made purchases through the barter account.”

RTÉ chairwoman Siún Ní Raghallaigh, who met on Friday with the Minister, said the Mazars findings were “further evidence of the deficiencies in the financial controls and procurement processes in place at RTÉ in the period under examination”. Ms Ní Raghallaigh said reforms were well under way, adding that “several of the issues” had already been addressed.

But Ms Martin criticised the “utter lack of proper procedures and controls that one would expect” from the national broadcaster, saying she must read the final report before saying whether RTÉ fully disclosed all barter account transactions to Oireachtas committees. “We will find out in October.”

[ Barter account report sets out ‘alarming gaps’ in RTÉ policies, procedures and controls - Minister ]

[ ‘No indications’ of issues in RTÉ during Future of Media Commission’s dealings with broadcaster ]

Ms Martin was unable to say who may have benefited directly from any effort to hide barter account payments, noting there was no list of those who had authority to execute transactions. She said it was not for her to comment on whether any potential fraud had occurred or whether there were issues that may have to be referred to the Garda or the Revenue.

Talks on emergency funding for RTÉ will proceed ahead of the October budget. However, a longer-term solution to RTÉ's financial woes and an overhaul of its funding model will not be decided on until early next year.

Asked about potential cost cuts at RTÉ, she would not be drawn on specifics but pointed out that director general Kevin Bakhurst had started talks with presenters and was liaising with staff.

Mr Bakhurst will discuss plans for a register of interests with unions representing RTÉ staff on Monday, she said. She expects sanctions will be imposed on anyone who breached compliance rules associated with the register.

Ms Martin’s low profile during a month when the crisis at the national broadcaster deepened was the subject of private criticism from some in government.

Pushed on her absence from the airwaves in the last month, she said she had spent time with her family and that was important to her but had also suffered a bereavement. “I was with a personal family matter, and that very close family relative died earlier this week.

“In dealing with a personal family matter, it meant I had to be away from base, and I don’t regret that because I got a chance to say goodbye to someone I loved very dearly.”