TV licence fee to be replaced with charge for all household devices

Government to put job traditionally done by An Post out to tender later this year

The Government has decided to put the collection of the TV licence fee out to tender, raising the possibility that An Post could lose the lucrative business.

Minister for Communications Richard Bruton will today confirm he has decided to accept the recommendations of the working group on the future of funding public service broadcasting, and will be putting the collection of the TV licence fee out to public tender later this year.

The successful bidder will be awarded a five-year contract for the service. In a further reform, once this five-year period has elapsed, the licence fee will be replaced by a “device-independent broadcasting charge” designed to capture households consuming publicly-funded content on devices other than traditional television sets.

Mr Bruton said an estimated 10 per cent of homes access content on devices which do not require a licence currently.

Collection of the €160 annual TV licence has previously been framed by campaigners and Opposition politicians as key to the survival of the rural post office network. Mr Bruton said the option of purchasing TV licences at post offices will remain regardless of which organisation secures the contract.

Minimise evasion

The Minister said tendering for five years will allow the winning body “the chance to invest in a robust collection service” to minimise evasion, which currently runs at an estimated 12 per cent per year.

“It is also clear that due to the nature of technological change and the movement towards digital devices, the design of the TV licence fee will have to change. This is a fundamental reform that will take time to develop, but it will future-proof the funding model, taking account of changes in technology and in how content is now consumed.”

The tender process is expected to attract significant interest from the public and private sectors. In addition to An Post, the Revenue Commissioners have previously been mooted as a potential collector of the fee.

British firm Capita, which collects the fee on behalf of the BBC in the UK, as well as Cork-based Abtran, which runs Irish Water’s call centre, are expected to be in the running for the contract, along with payments firm Payzone. The provision of free TV licences to those in receipt of the household benefits package will continue.

Reforms to the licence fee collection model are included in the Broadcasting (Amendment) Bill, which is being published on Friday and brought before the Dáil in the autumn. The bill proposes reforms to supports for independent broadcasters and local community radio.

Also under review will be the amount set aside by RTÉ for the commissioning of external content. Currently, the national broadcaster makes about €40 million a year available. The review will be carried out between 2019 and 2021.

Granting exemptions

Levies on independent broadcasters will be reduced, while the Broadcasting Authority of Ireland (BAI) will be given greater flexibility in granting exemptions and deferrals from the broadcasting levy. The Bill will also allow for BAI expenses to be part-funded – up to 50 per cent – from licence fee receipts.

It will allow for the creation of a new funding scheme which will grant bursaries to journalists in local or community radio stations. Mr Bruton also flagged a review of the Broadcasting Act 2009, which will address the level of funding made available for the Sound & Vision scheme. The BAI administers this scheme with the aim of supporting TV and radio programmes on Irish culture, heritage and experience. Currently, it receives 7 per cent of net TV licence receipts, or about €14.5 million.

Mr Bruton said that “public service broadcasting is more important now than ever. Independent, objective reporting of domestic and international affairs is crucial. However, we must recognise that the landscape in which broadcasters operate is undergoing a transformation and that this gives rise to new challenges. Audiences are transitioning away from traditional platforms and are increasingly accessing content online through digital mediums.”

‘Remit compromised’

In a statement, RTÉ said it had been making the case for reform of the TV licence system for many years, and it has been made in numerous independent reviews.

“While this decision by Government to tender for collection services is welcome, nonetheless the decision to defer implementation of a revised media charge system means that the crisis in the funding of public service media will continue.

“Latest evasion levels are 13 per cent, significantly higher than in the UK and other European countries. The fact is that the number of homes that do not have a traditional television set - but who are nonetheless consuming public service content - is increasing rapidly and the current television licence fee mechanism reflects less and less how people consume public-service content.

“When added to the evasion rate, currently close to 25 per cent of homes are now not paying the TV licence due to an outdated and inefficient system. This is resulting in tens of millions in lost funding for public media and the broader sector each year.”

RTÉ said the BAI had recommended an immediate increase in funding of €30million to the state broadcaster it could maintain public services and continue to support the Irish audio visual sector. “With reform now pushed out further, RTÉ’s capacity to deliver against its existing remit is severely compromised.”

Jack Horgan-Jones

Jack Horgan-Jones

Jack Horgan-Jones is a political reporter with The Irish Times