RTE planning hike in licence fee

VIEWERS face the prospect of paying more for their TV licence to help offset potential losses of €68 million at RTE.

The broadcasting authority also wants a crackdown on the estimated 14% of households who do not pay the licence fee, describing the percentage of defaulters as “high by international standards”.

RTE has urged the Government to allow it increase the licence fee from €160, which would be the first increase in three years.

The semi-state company said it needs more income to offset a major downturn in its advertising revenue, which has been sparked by the economic crisis.

However, while RTE published its annual report yesterday, the broadcaster decided to withhold releasing details of the salaries of the station’s top earners until later this summer.

The high level of pay among leading broadcasters, including Pat Kenny, Gerry Ryan and Marian Finucane, was criticised as “disproportionate and unjustifiable” by the chairman of the Joint Oireachtas Committee on Communications last month.

RTE director general Cathal Goan — who received a salary of €298,000 last year, plus another €50,000 in other benefits — said 2008 was a year “which started well but ended worryingly”.

The company said that while it achieved a break-even result last year, it anticipated a €68m shortfall this year — a 15% reduction in income.

Despite the economic downturn, revenue at RTE remained static at €441m.

Overall, RTE’s operating costs rose by 7% to €460.5m last year, although the station achieved a break-even position through a number of cost-cutting measures.

But the broadcaster warned that commercial revenues in the early part of 2009 have declined at an even sharper rate than in 2008, which will require much greater levels of restructuring than originally envisaged.

In an unusually self-congratulatory worded statement, RTE said its annual report “captures a performance characterised by prudent and proactive management against a background of sudden change and serious challenges in the external trading environment”.

The station also described its creative and competitive performance in 2008 in light of the economic downturn as “remarkable”.

Mr Goan said RTE, in common with all other parts of Irish society, is facing “new and stark realities” in the wake of the downturn.

The director general said RTE had anticipated a slowdown in the phenomenal growth of recent years in setting the 2008 budget, but no economic indicators had predicted the severity and speed of the decline in the economy.

However, Mr Goan stressed that 2008 had been a year of two halves as advertising revenue had increased 4% in the first six months of the year but had decreased by 13% between July and December.

He said the decision taken to put on hold plans to launch a TV channel for Irish people living abroad would continue to be reviewed.

The broadcaster also admitted that its pension fund had a deficit of over €102m at the end of 2008, compared with a surplus of €41m 12 months earlier.

RTE receives 84% of the annual licence fee, with the remainder split between TG4, the Broadcasting Commission of Ireland, An Post and government departments.

The station is also facing resistance from some of its 2,200 employees over plans to introduce pay cuts of up to 12.5%, despite two separate ballots by unions in favour of the cost-cutting measures.

Union sources said around 100 senior and well-paid staff will oppose any attempt to reduce their salaries without their personal agreement.

An RTE spokesperson confirmed that the issue remained the subject of ongoing discussions with individual employees.

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