Oireachtas Joint and Select Committees
Tuesday, 10 December 2019
Joint Oireachtas Committee on Communications, Climate Action and Environment
Future Funding of Public Service Broadcasting: Discussion
I welcome from RTÉ, Ms Dee Forbes, director general, Ms Breda O'Keeffe, chief financial officer, Mr. Rory Coveney, director of strategy, and Ms Eimear Cusack, director of human resources; and from the Department of Communications, Climate Action and Environment, Ms Patricia Cronin, assistant secretary general, and Ms Triona Quill, principal officer.
Before we begin, I draw the attention of witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to this committee. However, if they are directed by the Chairman to cease giving evidence in relation to a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. Witnesses are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable. I also wish to advise the witnesses that any submissions or opening statements they make to the committee will be published on the committee website after the meeting.
Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official either by name or in such a way as to make him or her identifiable.
I remind members and witnesses to turn off their mobile phones or to switch them to flight mode as they will interfere with the television and broadcasting coverage.
I invite Ms Dee Forbes to make her opening statement.
Ms Dee Forbes:
I thank the committee for inviting us. The invitation came just before we made announcements on our revised strategy, but the indicated topics the committee asked us to discuss, around the future funding of public service media and the value for money of our indigenous and acquired programming, are important and timely considerations.
First, let me address the Report on the Future Funding of Public Service Broadcasting, published by this committee in November 2017. As members will recall, we welcomed not only the findings of this report but also the depth and breadth of the committee’s research, engagement and consideration of this topic. The report was based on original research, data analysis, a wide-ranging stakeholder consultation, a full day’s conference and debate, and substantial discussion and consideration by the committee members. The report made a number of clear and well-informed recommendations that were widely accepted and endorsed within the broader media sector.
In 2018, a decision was taken by the then Minister, Deputy Naughten, to set up yet another working group to look at the future funding of public service broadcasting, and the findings of that group were presented to the Minister, Deputy Bruton, earlier this year. In August 2019, the Minister, Deputy Bruton, made a formal statement in this regard, acknowledging the importance of the protection of public service broadcasting, stating:
Public service broadcasting is more important now than ever. Independent, objective reporting of domestic and international affairs is crucial.
He also acknowledged that audiences were increasingly moving online for their media consumption and that the licence fee system would need to adapt accordingly. However, the remedy proposed was that the licence fee collection would be put out to tender and that the term of contract would be for a five-year period. Given that the collecting agent would likely be contracted from 2021 onward, this would, in effect, delay the transition to a media charge for close to seven years from the point of announcement. That is completely untenable.
Evasion is now almost 13%, resulting in the loss of some €25 million per year. By virtue of outdated legislation, a further 11% of households, and the figure is growing, do not pay the television licence and yet can consume public service programming on their online devices. By way of example, for the recent Ireland v. Russia Rugby World Cup match, we had near equivalent viewership on the RTÉ Player live streaming as we had watching the match on RTÉ 2. This lag in legislation is resulting in a further loss of €20 million in public funding annually. Licence fee receipts are down against forecast for this year, and have been for the past number of months, making a difficult financial situation even more acute for us and for the industry. Ireland’s television licence system is irrevocably broken and is no longer capable of properly sustaining public service broadcasting or Ireland’s broader audiovisual and creative sector.
All that said, against this reality, RTÉ is clear that it must also take action to change to remain sustainable and relevant for Irish audiences. RTÉ has already made significant changes to the organisation in recent years, but the way media is being consumed by audiences everywhere is changing and we need to evolve even further if we are to meet audience needs effectively. The challenges that lie ahead are many and include the following. With regard to global trends, the media landscape worldwide is changing at a pace that has exceeded all forecasts. The rise of the media superpowers and the potential impact on dilution of national culture within a small country like Ireland should be a matter of real concern. The next challenge concerns audience shifts and patterns.
Audiences, especially younger people, are changing the way that they select and access media, and we need to meet these audiences where they expect to find us, especially in terms of our online services. Wide-ranging budget adjustments are required to stabilise RTÉ’s finances and ensure increased investment to deliver the type of service and content that we know our audiences want. This means creating greater efficiencies within the operating costs, new work practices, more efficient use of the regional studios and other pay-cost related measures. As I have said on a number of occasions, it is not possible for RTÉ to continue to operate from a position of deficit. We need to reduce projected costs by €60 million over the next three years. This is in addition to the reductions of 23% on operating costs achieved between 2008 and 2018. To be clear, many of these changes need to happen and will happen irrespective of licence fee reform. RTÉ’s programming and service choices will also need to be refreshed and be under constant review to ensure that these remain relevant and impactful for audiences. This leads me to this committee's secondary point of interest, namely, value for money and indigenous and acquired programming.
The current licence fee costs the equivalent of 44 cent per day, of which RTÉ receives the lions’ share, with the BAI's sound and vision scheme also receiving support. For this 44 cent per day, RTÉ deliverscomprehensive local, national and international news in both English and Irish. We retain the largest network of regional correspondents of any media outlet in the country. We also provide dedicated reporting from London, Brussels and the US. RTÉ provides all Irish language television news for both RTÉ and TG4. In terms of investigative reporting, this year alone RTÉ has brought to public attention investigations into crèche standards and regulation, animal welfare issues within the greyhound industry, child sexual abuse allegations in certain scouting organisations, and challenges to the regulatory standards by some quarry companies and their impact on the Irish landscape.
We have covered essential national moments on a free-to-air basis, from the big wins at tournaments such as the Rugby World Cup in Japan, the GAA finals in Croke Park, the Irish women’s hockey win in Donnybrook and the women’s Rugby World Cup journey this summer.
Culture Night, Wexford Opera and next year’s Galway 2020 partnership are all testimony to our support and commitment to the promotion of national arts and culture, as is our ongoing RTÉ Supporting the Arts scheme, which promotes and supports approximately 150 arts and culture events throughout the country each year.
We can shine a spotlight on key public issues such as health and well-being with shows like "Ireland’s Fittest Family" and "Operation Transformation"; the value of family, community and the development and well-being of children through a series like "Raised by the Village"; or the recent focus on climate change with RTÉ 's climate week, culminating in a debate in this house with young people from every constituency in the country, which was a global first.
RTÉ hosts Ireland’s only national dedicated Irish language radio service, Raidió na Gaeltachta, and the strengthening of our broadcast partnership with TG4.
We offer a wide ranging celebration of music of all forms,from the Choice music partnership and the 2FM Rising initiative, the 2FM Studio 8 sessions, and Other Voices, all of which support and promote new young Irish acts. We provide support for traditional music through Ceili House on Radio 1 and the recently launched Irish Folk Awards, and for classical music through Lyric FM, and the RTÉ National Symphony Orchestra’s Music in the Classroom initiative, to name just a few.
We support discussion and debate, whether that is on any one of our radio service which reach more than 2 million listeners each week, with audience participation programmes such as "Liveline" with Joe Duffy or "Claire Byrne Live", or the topical discussions that feature on flagship entertainment programmes such as "The Late Late Show". All of these programmes elevate awareness and engagement on the topics that matter most to Irish audiences every day. Beyond these, RTÉ provides many more moments of entertainment, celebration, revelation and reflection.
It is fair to say that aforementioned represents good value for 44 cent a day per household, especially in comparison with the subscription costs to other media services, none of which offers anywhere near this level of Irish perspective or output. In terms of value, it is also useful to compare RTÉ's spend and services with other international public service media providers. In terms of our nearest counterpart, BBC 1 costs were £1.106 billion and BBC 2 costs were £381 million, consuming the bulk of the £1.678 billion spent by BBC on its television output in 2018. All of RTÉ's services are delivered for less than the BBC spends on its secondary television channel. The total revenue available to the Norwegian public service media provider NRK is €600 million while the Finnish public broadcasting service YLE revenue in 2018 was €475 million. RTÉ is providing a public service offering of equivalence with much less revenue. There is no doubt that national media services are struggling with the haemorrhaging of commercial income to the large-scale digital players in particular. This should be a matter of concern for all of us. It is a false comparison to perceive RTÉ as being exempt from that struggle or well-off by comparison. Our remit is different, our responsibilities are greater, and our costs reflect that.
There will always be things that our audiences would like to see us offer more or less of, depending on personal tastes and interests, but in overall terms, RTÉ offers a broad range of services with good levels of cost efficiency. RTÉ has exercised significant cost control, resulting in its 2018 costs being almost 25% lower than a decade ago. While RTÉ’s costs in the past three years have increased by a modest 6%, this reflects increases in the cost of making programmes and in the cost of competitive rights, both of which outstrip typical inflation, as well as significant public service obligations. Cost efficiency is routinely scrutinised by our regulator, the Broadcasting Authority of Ireland, and on more than one occasion by NewERA. On each evaluation, the organisation has met the metrics and the standards that were set.
The following is the breakdown of acquired programming versus home-produced programming within RTÉ’s overall output and spend. In RTÉ One, the total spend on indigenous Irish programming was €110.4 million and the spend on acquired programming, including a portion of spend to Irish acquisitions, was €14.7 million or approximately 12% of the overall spend. In RTÉ 2, the total spend on local programming was €42.2 million and the spend on acquired programming was €9.5 million or approximately 18% of the overall total of €51.7 million. RTÉ’s use of acquired programming within its schedules is considerably less than many other public service media organisations of equivalent scale. For example, the Swedish, Danish and Finnish public broadcasters feature international programming as more than 50% of their overall schedule. It is a criteria that the BAI tracks within its assessment of performance every year. On RTÉ One, the number of hours of local content was 76%, a little over the target of 75%. On RTÉ 2 it was just under 40% which was also within the target range. Acquired programming has an important role to play in all public service media schedules. It brings high-quality content of all types from around the world at a very competitive price. Integrating programming from other countries can add to the diversity of the schedule and enhance our perspective on the world. For a smaller country like Ireland, acquired programmes can help balance the running costs of individual service and enhance complementarity and choice within the overall live viewing offerings in particular.
As the RTÉ Player continues to evolve, we have been increasing the rights access to international programming and we have been increasing our video-on-demand access within all new negotiations, offering additional value and opportunity to view for our viewers, and this will continue as on-demand becomes ever more popular. In this way, some of the best content created on an international basis is made available on a free-to-air basis, to Irish audiences. However, it is indigenous Irish programming that ultimately is of most value in terms of helping to define the character and distinctiveness of national public service broadcasting, and it is the area in which we have ambitions to invest more in the years ahead. As noted in the Broadcasting Authority of Ireland's Mediatique report of 2017, the most recent comprehensive report on the overall national media market, expenditure on original Irish TV content is dominated by the public service broadcasters, led by RTÉ. Although some of the other commercial services such as Sky would have a larger overall spend on content offerings, only a very small percentage of this is on original Irish production. Investing in Irish programming is also the way in which RTÉ can most meaningfully contribute to the ambitions of the national audiovisual action plan and how it can help create real stimulus within the creative economy.
Ireland punches above its weight with regard to the talent that is available, internationally recognised independent production companies, BAFTA winning directors, and Academy Award winning animation. Over the years, RTÉ has been privileged to work with some of Ireland's finest actors, directors, writers, producers and independent companies. In 2018, RTÉ invested just over €40 million in the independent sector, but that pales in comparison with what our spend once was.
Apart from the impact on RTÉ, this sector has also been severely adversely affected by the moneys lost through Ireland's outdated and inefficient collection system. Although RTÉ remains the largest commissioner of indigenous Irish content, spend on this important element of national storytelling lags behind its potential. The real cost is the lost opportunity. The effects of this are threefold. The creative economy is deprived of much-needed stimulus. Public service broadcasters are a key investor in and showcase for independent production companies. Many of most talented programme makers, screenwriters, actors and comedians leave for the UK, US and beyond. It is a drain in talent that a small country like Ireland cannot afford. Perhaps most importantly, Irish audiences lose out. Indigenous programming and journalism suffer, repeats become a feature of schedules more than is desirable, and audiences switch off from national services in favour of international competitors, which means less engagement with national topics and national culture. Ultimately, this encapsulates the nub of the current position and what is at risk.
The challenges being faced are a serious threat to the future of public service broadcasting at a time when public service media, with a publicly owned national service to reflect Ireland's voice and identity, have never been more important. It has material consequences for the audiovisual, sports and cultural sectors of the country. RTÉ has a plan to address this, but unless there is commensurate policy and legislative action, then public service media will potentially be weakened irrevocably. Less than two weeks ago, "The Late Late Toy Show" attracted a live audience of more than 1.3 million viewers, or 1.7 million in total when one adds worldwide streaming. That show was about many things. It was a big show with brave voices, electric performances and a lot of fun. At its core were the stories and experiences of some remarkable Irish kids. The nation listened and we witnessed a huge outpouring of support for this incredible showcase of talent, diversity and inspiration. It showed yet again that coming together as a community is a big part of who we are. That is something that we should all fight for.
Ms Patricia Cronin:
I thank the Chair and members of the committee for inviting us to participate in today's meeting. I hope that today's exchange will be of benefit to the committee in its understanding of funding issues regarding public sector broadcasting. I will make a brief public statement and then, following contributions from RTÉ, Ms Triona Quill and I will be available to answer questions.
There have been significant changes in the broadcasting sector in the past decade. These include the rise of digital advertising via search engines and social media, advances in content streaming services, and changes in the way people access audiovisual content. While these changes have improved the accessibility and quality of content, recent developments such as disinformation highlight the importance of trusted and reliable sources of publicly available information. Both public and private broadcasters have been impacted by these developments with the impact on advertising revenues. Share of advertising spend in the digital sector has risen from 7% in 2007 to a current figure of 40% in an environment where it is estimated that Google and Facebook obtain 75% of all digital sector advertising spend. Changing advertising trends arising both from the recession and from Brexit have resulted in a decline of approximately 35% in commercial revenues available to Irish broadcasters since 2009, with media convergence and the resultant shift to digital advertising impacting heavily upon broadcasting and print media in particular.
The decline in advertising revenue, coupled with challenges with the TV licensing collection model, such as the unacceptably high evasion rate, currently running at nearly 13%, the exclusion of 10% of households that do not have a TV and the relatively high collection costs of 7%, is having a critical impact on RTÉ's revenues and has resulted in a position where the financial sustainability of the organisation is now under immediate threat.
To address its current financial position, RTÉ has put together a revised strategy to cover the next four years that will include a number of changes to its current portfolio. These include cost reduction, further land and asset sales, increased public funding, future-proofing its offering and offering live experiences with ticketed events. In recognition of the current financial situation at RTÉ, the Minister requested that NewERA evaluate the revised RTÉ strategy with a view to assessing RTÉ's feasibility. In its report, NewERA agreed that the current financial situation at the broadcaster is unsustainable. The Department is in ongoing contact with senior management in RTÉ regarding its financial position and proposals for reform. The detail of these matters is being considered by Department officials in conjunction with NewERA officials and colleagues from the Department of Public Expenditure and Reform, and the Minister intends to bring forward a memo on the matter shortly. That has been overtaken by events this morning, which I am happy to cover.
An additional €10 million in public funding has been allocated to RTÉ over the past two budgets. This includes an additional €8.6 million made available in budget 2019 through a combination of an increase in Exchequer funding for public service broadcasting, which replaced TG4's TV licence funding, and an increase in the amount paid by the Department of Employment Affairs and Social Protection for free TV licences. This builds on the increase in funding for public service broadcasting in 2018, funded through a €1.64 million increase in the Department of Employment Affairs and Social Protection's contribution for free TV licences. TG4 was allocated an additional €443,000 in Exchequer funding for 2019 in addition to the €2 million in current and capital funding that it received in 2018, bringing the total increase since the start of the five-year review period to almost €2.5 million. TG4 was also allocated a once-off capital grant of €985,000 in 2018 for its expenditure relating to Bliain na Gaeilge.
The increased contribution from the Department of Employment Affairs and Social Protection in both 2018 and 2019 also benefits An Post and the broadcasting fund. The broadcasting fund is a fund administered by the Broadcasting Authority of Ireland, BAI, that includes the sound and vision scheme, which supports high-quality programming on Irish culture, heritage and experience, programmes to improve adult literacy, and archiving schemes. It benefits the broadcasting sector as a whole, including independent production.
In its report published in November 2017, the Joint Committee on Communications, Climate Action and Environment recommended that Revenue collect the TV licence and the replacement of the current TV licence with a broadcasting charge. In response, the working group on the future funding of public service broadcasting was set up by a Government decision in July 2018 to examine options for the future funding of broadcasting. The key recommendations of its report are that the TV licence be put out to public tender as soon as the enabling legislation, the Broadcasting (Amendment) Bill, is enacted. It will be necessary to offer a fixed term contract of five years to make it feasible for the successful tenderer to invest in the database and collection improvements. Another recommendation is that at the end of the contract period, the licence fee should be replaced by a device-independent charge to support public service content on a sustainable basis. It was felt by the group that due to a number of issues surrounding the implementation of a device-independent charge, including owner-occupier liability, how to charge commercial premises, perception issues around collecting with the local property tax, and how the charge would be collected from social and local authority housing, an interim measure was needed to address the issue immediately. The Government has accepted the working group’s recommendations and is bringing forward an amendment to the Broadcasting Act that will enable the collection of the TV licence to be put out to public tender.
On 18 July 2019, the Government approved the publication of the Broadcasting (Amendment) Bill 2019 and tabled an amendment on Committee Stage to appoint an agent through a public procurement competition for the collection of the TV licence fee. The proposed amendments to the Broadcasting Act 2009 will allow for the Broadcasting Authority of Ireland to be part funded up to a maximum of 50% from TV licence receipts. It is intended that any consequent reductions in broadcasting levy contributions would be applied across the board by the BAI so that all broadcasters would benefit in equal proportion from the measure. It is proposed that doing this will provide scope to exempt smaller community radio stations from the broadcasting levy altogether. The Bill allows for the Minister to decide what percentage of the levy to fund from TV licence receipts. It will allow the BAI to accrue a level of working capital to meet its day-to-day expenses without the need to pursue a costly and burdensome borrowing facility and grant authority to the BAI to determine exemptions and deferrals to the levy depending on the qualifying income of individual broadcasters and the level of regulation they require.
It will give the BAI greater flexibility regarding which broadcasters are covered by the levy and to what extent. This will create a legislative environment by which new broadcasters, including, for example, any that might wish to relocate to the State after Brexit, can be levied appropriately, thereby contributing to the cost of their regulation. A number of broadcasters have relocated EU services to Ireland already in light of Brexit, the main ones being Sports Information Services, SIS, and SSBL which operates FreeSports. The BAI has licensed four section 71 contracts in the past ten months. The BAI remains in contact with a number of large UK-based broadcasters which are considering relocating to Ireland if a no-deal Brexit materialises.
The Bill also addresses a gap in the existing legislation whereby the holder of the section 70 contract is exempted from the requirement to apply for a licence for any additional services it chooses to offer. It seeks to ensure that any new services could not operate on an unregulated basis and clarifies that they would require a section 71 licence.
In order to further support community and local radio, the Bill will allow for the creation of a new funding scheme that would permit the granting of bursaries to journalists in these stations, which are the starting point for many journalists’ careers. It is intended that approximately €500,000 would be made available by the BAI to support 20 annual bursaries of €25,000 each.
The Bill repeals sections 103 and 251 of the Copyright and Related Rights Act 2000 as the public policy objectives for which they were introduced, mainly to support the roll-out of cable television services in Ireland, have been achieved. In addition, television services are now available over a wider range of platforms, including satellite, which do not benefit from a similar exemption. The proposed repeals have been agreed with the Minister for Business, Enterprise and Innovation.
The Bill went through Second Stage in the Dáil on 21 October and is expected to be brought to Committee Stage in the new year.
I hope that this has helped the committee in its consideration of these issues. Along with my colleague, Ms Quill, I look forward to answering any questions members may have.
I have a question for RTÉ. When RTÉ raises concerns about resourcing difficulties, members of the public will often highlight the high salaries paid to some of the stars within RTÉ. According to RTÉ's figures, one presenter earned more than €300,000 in 2016 for hosting two shows a week. That is well in excess of what the Taoiseach earns working, one could say, up to seven days a week. I know the salaries are subject to further cuts of 15%. I am conscious that a large amount of the funding RTÉ receives is taxpayers' money. Is it down to the popularity of the show or what metric does RTÉ use to decide salaries for its star presenters?
Ms Dee Forbes:
As the Chairman knows, RTÉ has a public service remit. It also has a commercial remit to commercialise the output we create and put to air. The role of our presenters is multifaceted. They present several shows depending on the individual. They are very important to RTÉ and are very important to the messages they have to deliver on a regular basis. I understand why this is a topic of conversation among the public. The role of presenting a show and being a broadcaster can be difficult. It is not something that everybody can do despite what the public might think. We highly value the contributions these people make to RTÉ and beyond. In the context of our current situation, we are addressing that with the presenters concerned. They will be subject to ongoing discussion for the future.
There is a market for presenters. On the basis of information we have received in recent months, five of the ten top-paid presenters are outside RTÉ. There is a bit of a myth that there is not a market. There is a market for presenters, which is quite competitive at the moment, both here and in the UK. Having said that, we recognise that given our financial situation, we need to address the matter. We are doing that by asking our key presenters to take a 15% cut, which is on top of the cut of in excess of 30% that they have taken in recent years.
There are many people, including other non-members, present who want to ask questions. I will bring them in, but I am conscious of time. I will let members of the committee speak first and give them ten minutes each. If they want to share their time with other Members of their party, they are very welcome to do that within the ten-minute slot. We will then see what time is available for our guest Members - I apologise for using that term.
I thank Ms Forbes and Ms Cronin for their presentations.
Ms Forbes gave a comprehensive outline of the position. Most people accept and recognise the challenge. My party absolutely supports public service broadcasting and we have done that. When Ms Forbes appeared before the committee about three years ago she challenged us to look at the licence fee funding model. The committee did that under the guidance of the Chairman and we presented that report, which is widely accepted as a blueprint for the funding of public service broadcasting into the future.
At that time, we challenged Ms Forbes to bring forward a plan. In her statement today she said:
Ultimately, this encapsulates, the nub of the current position and what is at risk. The challenges being faced are a serious threat to the future of public service broadcasting.
The reality is that they are the same challenges that effectively existed three and a half years ago. While there was an iteration of a plan that was supposed to set RTÉ back on to an even keel, we now have another plan. Further land may be sold, the RTÉ Guidemay be sold and some art may also be sold. We are somewhat sceptical about what we are hearing. We had great belief in RTÉ when, three and a half years ago, it set out in a very direct way its desire to put a plan in place. What it has done to date has not worked. I do not put all that on Ms Forbes's shoulders. While this committee responded to her challenge, how the Government responded to that is another matter. I am on record over the Government failures in that regard. Is Ms Forbes happy with the level of transformation that has been achieved in her tenure?
Ms Dee Forbes:
There is a lot in the Deputy's question. When I started in RTÉ the first thing I did was to look at how the organisation is structured, knowing that we are facing major transformation in the industry, to determine whether RTÉ was positioned appropriately for that challenge, particularly as viewing habits were changing. With that in mind, we restructured the organisation. That process is under way and is working incredibly well in some areas, while in other areas it may not be working as well. That is typical of any reorganisation. Having said that, this was also put in place when we worked on our five-year strategy for the BAI.
Ms Dee Forbes:
Exactly. This is where we moved to. Instead of thinking about the platform first, we really wanted to put the audience at the centre of the organisation. Audience habits have been changing and audiences now are not as bothered about where the content comes from. Instead, they want to be sure they can get it when they want it. In putting together the one RTÉ strategy we put all the documentary teams from television and radio together in one team, for example. Our content people now works across every platform. We are thinking about audience first and distribution platform second. It has meant that, for example, in something like arts and culture, which is a key remit of RTÉ, we have put together teams that typically would have worked separately and the results speak for themselves. Culture Night, which was really the domain of RTÉ radio until a few years ago, is now a major night and event for RTÉ across radio, television and online. That is the principle.
On a day-to-day level the silos still exist. We have radio, television-----
The platforms still exist and they always will. The thinking is what is changing within RTÉ. It is very important that we do not simply think of a programme as being on television or on radio. It could go across the pieces. That is the structural aspect.
It is also important to refer to the strategy we put in place for the next five years, which was submitted to the BAI in 2017. That strategy comprised our recommendations in light of what is coming and what the future will ask of us. That fell on deaf ears at Government level. The BAI endorsed the strategy but stated that it required an immediate €30 million in funding for RTÉ. I say this to answer the Deputy's question about what has not happened. We have been doing an awful lot within RTÉ to change and to pivot in the right direction for the audience. However the public funding solution has not emerged.
Let us look at the funding issue. Ms Forbes talked about making savings of €60 million over the next three years. Can she detail the line items in the third year? Perhaps Ms O'Keeffe will have that information. I refer to the line items comprising that €60 million. Perhaps the witnesses can provide that for us at a later stage. I would like a breakdown of that €60 million.
Ms Dee Forbes:
We expect that approximately 200 staff will leave RTÉ. That will partly arise from a voluntary redundancy scheme. A certain number will transfer under European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003, TUPE, with the RTÉ National Symphony Orchestra. As the Deputy may recall, the orchestra will transfer to the National Concert Hall.
Ms Breda O'Keeffe:
There are to be savings of €60 million over the next three years. By the third year, we are looking for savings of between €9 million and €10 million from personnel-related operating costs. That will include up to 200 staff, which, as Ms Forbes mentioned, will leave either through voluntary exits or transfer of undertakings. We are also seeking-----
I want the cumulative figure. Current revenues are €339 million or €340 million, which comprise commercial revenue and licence fees. The management wants to cut spending to €60 million below that figure by-----
Ms Breda O'Keeffe:
Yes. We want to cut roughly €20 million per annum, of which between €9 million and €10 million will come from reductions in content and services. Roughly the same amount will come from personnel-related operating costs. We are also looking at cutting non-personnel-related operating costs by running tighter procurement processes, changing our travel and subsistence policies and various other things. We have significantly reduced those costs over the year in the interest of maintaining employment. In those other areas of cost reduction, we have sought quite-----
Ms Breda O'Keeffe:
Our overall financial strategy is a three-strand approach. It is based on three pillars. We have outlined the cost reductions that RTÉ will make through changes to our content, services and cost base. Through this, we aim to achieve cost reductions of €60 million in the next three years. An important part of our financial strategy, which we mentioned earlier, is commercial revenue. It is important that any strategy we pursue stabilises that.
Ms Breda O'Keeffe:
I am trying to answer the question about the financial strategy. It is important that we shore up commercial revenue. It has decreased significantly this year as a result of Brexit. Shoring up and stabilising commercial revenue is a key part of our strategy. A couple of years ago we consolidated training, which was an important step. The third part of the strategy, which is of key importance, is securing additional public funding.
Ms O'Keeffe is saying that to achieve stability, in addition to savings of €20 million per year, and, cumulatively, €60 million, the strategy is based on the expectation of getting an additional €90 million over that three years.
Ms Breda O'Keeffe:
It is based on additional funding of €30 million per annum, of which €10 million was provided in 2018 and 2019, as Ms Cronin outlined. A further €10 million per annum in funding has been announced today, which is most welcome. We, therefore, need €10 million more per annum, amounting to €30 million over the next three years-----
I only have ten minutes, so I would like the answers to my questions to be as succinct as possible. I have a lot of questions to get through. I will start where Deputy Dooley started by saying that the members of this committee support public broadcasting. Anyone who supports public services should support public broadcasting. This committee did a very lengthy piece of work, which resulted in an all-party report supporting some of the measures called for in Ms Forbes's opening statement. Given the key recommendations of that report and the measures Ms Forbes is asking for, has the can essentially been kicked down the road for at least five years? Is that her view of the response of the Department and the Government?
Ms Patricia Cronin:
The Government decided to set up the group. Its work was informed by the work of this committee. We looked at various options, including the options the committee recommended. The report sets out various complexities that would arise from them. I can outline those if the Deputy likes, but the nub of the issue is that, based on our evaluations, we advised the Government that the best short-term approach was to put the TV license fee collection out to tender. In the longer term, we recommended a device-independent charge.
We need to hear from the Minister. I wish to request that we invite him to appear at some point after today. These are policy decisions.
I would like to raise RTE's plan. Is this the plan that was submitted to the Department, or was supplementary information or a more detailed submission given to the Department?
Ms Dee Forbes:
A lot of detailed information was provided to the Department.
It was also the subject of reviews by PricewaterhouseCoopers, PwC, and NewERA. We worked with our internal teams to get to the strategy and the board asked that PwC examine the strategy. When that was presented to the Department, the Minister asked that NewERA examine it. There is significant-----
Ms Forbes was put under robust questioning on "Morning Ireland" and "Drivetime", which was good. It struck me that the questions being asked related to the specifics of costings. The information I have mentions "strategy specifics" and there is a set of line items setting out what needs to be done, modified or reduced. No costings are provided, however. The RTÉ Guidewas up for sale. How much would that have saved?
If any political party published a set of proposals to save €60 million, with no costings provided, and stated the information was confidential and could not be provided, we would be laughed out of the room by any RTÉ presenter. I seek a little more detail on the costs. I accept that Ms Forbes stated the information about the RTÉ Guideis commercially sensitive, but on the consequences of closing the RTÉ Lyric FM studio in Limerick, no costing has been provided, while to provide for savings from pay cuts, no costing has been provided. There is also no costing for reducing the staff headcount by 200. I do not see any line costings by which I can hold Ms Forbes to account, to ensure that the savings can be achieved and that the figure of €60 million adds up. If I were to present this to RTÉ as a strategy, and state that I would save €60 million but not how much each line item would cost, I would be laughed out of the room.
Ms Dee Forbes:
As my colleague outlined, we can quantify the €60 million in broad buckets. We have given the information in detail to the Department and NewERA has been across it all. I am happy to take the Deputy through some of the detail in a separate forum if he wishes. The €60 million is a combination of a number of factors. No one measure will return RTÉ to a financially stable position. As Ms O'Keeffe noted, a number of factors have to be at play. Public funding has to be reformed, our commercial revenue has to be stabilised and we have to cut our costs. All three elements have to come together to make the savings possible.
I accept that, but it is no good Ms Forbes appearing before the committee and stating she can furnish us with more detail at a later date. I had hoped that we would receive detailed breakdowns in advance of the meeting. On the €10 million in funding announced today, which is welcome, was there any quid pro quoagreed with the Department to reverse any of the decisions?
Exactly. I am trying to understand how RTÉ will achieve €60 million in savings. The RTÉ Guidesale has been reversed, perhaps for good reason, although I suspect it has been taken off the shelf only because of a lack of expressions of interest. Is it possible that if there was better interest, RTÉ might proceed with the sale? There is no guarantee that RTÉ will achieve the savings in pay, given that there will have to be negotiations, and it will have to discuss cuts with the trade unions. I am not in favour of job cuts because the people who will lose their jobs will not be the top presenters. They are ordinary workers on ordinary incomes and I have a great concern about that.
There are large holes in the strategy. Unless Ms Forbes is able to give me a full breakdown of where the €60 million savings can be achieved - not broad headings - it will not cut it in respect of accountability.
Ms Breda O'Keeffe:
In fairness, RTÉ has reduced its cost base by almost 25%. Between the years 2008 and 2013, inclusive, RTÉ delivered cuts of more than 30% in its cost base. NewERA conducted an efficiency review of RTÉ in 2015 and judged us to be efficient. The report, which the Deputy can read if he wishes, stated that we had delivered cost savings in excess of those of many other organisations. Undoubtedly, €20 million per annum will be very difficult, not least because of the work we have done to date, which has resulted in our cost base being 25% lower than it was in 2008. The Deputy is correct to express concern that achieving the savings will be challenging, but we have demonstrated an ability to save, together with our staff and management. It is not just we who have done it. Our staff were co-operative in taking pay reductions in 2008 and 2009.
I do not question what the organisation or Ms O'Keeffe has done in the past. I have listened to Ms Forbes on a number of occasions respond to questions and many people have asked questions about whether the savings can be achieved. We have a job to ask questions, such as whether the €60 million in savings can be achieved, but all I have received is a one-page document with no costings or line items. Broad, general headings do not cut it. It is not good enough that the detail was not given to us before the meeting. I ask that RTÉ forward to the committee, which is the line committee to which RTÉ is answerable, a bit more detail on how the €60 million in savings will be achieved. If some issues are commercially sensitive, that is fine. Staff at RTÉ will potentially lose their jobs, there are questions as to whether the top presenters will take the proposed 15% pay cut and there are concerns about Lyric FM. A presentation was made at Leinster House about people who have settled in Limerick with their families but will have to move. I accept that these are challenging times and that this is not a position that RTÉ wants to be in. While I support the allocation of additional funding to RTÉ and public broadcasting, I do not like being given a plan with no specifics and being told, in general terms, that the savings will be achieved. I would like to be provided with a bit more than one page and hope that following the meeting, our guests will provide us with a bit more detail than what we have been given.
On the point discussed by Deputy Cullinane, Ms Forbes stated seven persons are on contract and that RTÉ is in negotiation with them about pay reductions. She was not clear as to whether any of them has yet committed to a reduction. Have there been any commitments, aside from statements from them to the effect that they will go with the flow?
Ms Dee Forbes:
One discussion has been completed and the rest are ongoing. All the people concerned are under contract and, therefore, we will appeal to them to discuss the matter with us outside of their contracts. Moreover, on renewal, there will be further discussion. Both steps are being taken at the same time.
I accept it could be wrong information but it has been suggested to me that the 30% figure, which is a global figure, included one particular person who left the organisation from whom credit was taken while the others were given the benefit of that. Is that correct?
Ms Breda O'Keeffe:
No. How we evaluate the top ten is that we literally take the top ten earners in one year and compare them to the top ten in the comparative year. Those names can change. If a person leaves the organisation, for example, they would not be on the second list. They are replaced by somebody else in the top ten.
These percentages are easy to talk about. However, at some stage, even in global terms, we should have the actual amount of cash that this programme of renegotiation etc, will actually realise. Can that be done?
Ms Forbes agreed with Deputy Cullinane that the decision to put out to tender the television licence fee collection system could be described as either unsustainable or kicking it down the road.
I note the Department has stated there are difficulties with using the local property tax model because the landlord is usually the owner and is liable for it. With a bit of thought, the Department could have put in place a burden-sharing between the landlord and tenant. It does not take five years to work that out. I suggest that the Department has deliberately chosen, perhaps because of the electoral cycle, not to accept what this committee recommended. Instead, it has given itself a five to seven-year holiday from reality. It has decided to ignore the obvious proposition, which I among others have spoken about at this committee and elsewhere. There are simple collection mechanisms for every home, every hotel and business that uses communication, which the Revenue Commissioners could easily implement through local property tax, commercial rates or whatever.
Why has the Department said this is so complex that it needs several years to do it when it is just a case of the Department rolling up its sleeves? The Department has had months since the committee’s report on this issue was tendered to it. It could have come up with a positive decision as to what it wanted to do. I do not want to put Ms Cronin under too much pressure. However, the Minister should be here in my view to explain to the committee why our report has been shelved. The inference I am drawing is that it is political cowardice.
The idea that it is too complicated to work out how the Revenue could collect this just does not stand up to reason. There is a Finance Bill every year that deals with loopholes. Massive legislation is composed within months. I suggest this is a deliberate choice not to face up to this issue.
I thank the witnesses for their presentations. I want to ask some direct questions. The local NUJ branch in RTÉ had a proposal that all salaries in the organisation would be capped at €200,000. How much could be saved annually if that proposal was implemented?
It is the case that the local NUJ branch in RTÉ put forward a proposal and voted that all salaries would be capped at €200,000. Ms Forbes must be aware of that. Has she worked out the figure that could be saved annually? It involves all salaries, not just the top ten earners but everybody, including the witnesses.
Ms Dee Forbes:
All of these changes are part of several things that would need to happen to stabilise RTÉ's finances. Picking out one or the other, while there are numbers attached to some, they are not as clean as the question would suggest. We must ensure that we can deliver services to the public more efficiently than we are doing. That is what is tied up in all of this. There is a complex set of circumstances at play here. The proposed move of Lyric FM is part of that. It is worth bearing in mind that we have excess capacity in Cork and Dublin. Part of the thinking was to ensure that excess capacity could be utilised while preserving the service to the public and, at the same time, reducing costs overall. That is the context of the Limerick discussion and why Lyric is one of those proposals. We have just been hearing-----
Ms Forbes, I only have ten minutes. That would not be an acceptable answer for the staff in Limerick, many of whom have settled and bought homes there on the understanding that this was to be where they would work. It is not good for the city of Limerick. This sort of rambling answer is not acceptable when I asked a direct question. There must be some idea of how much would be saved if Lyric was moved out of Limerick.
Ms Dee Forbes:
We are beginning discussions with staff in Limerick on Friday as to what exactly is at play. The exact number will depend on several matters. Again, I appreciate that this is upsetting for staff living in Limerick. That is why we must have the discussions with them as to what is at stake.
I am not getting an answer to that.
The cap placed on the level of contribution received from the Department of Employment Affairs and Social Protection in lieu of the free TV licence, as part of the household package, amounted to a reduction of €5 million in RTÉ’s funding for the first year and has subsequently risen. Has Ms Forbes calculated how much was lost by RTÉ with this measure? In another discussion on transport, one finds the full amount of free travel that Dublin Bus, Bus Éireann and others give to the public under the Department of Employment Affairs and Social Protection scheme does not come back to those companies. Has RTÉ calculated how much it has lost as a result of this?
I am really surprised that these figures are not available to us. These questions are very simple. I would like to get an answer. Would Ms Forbes agree that the entire subsistence in respect of the free TV licence should be reinstated to RTÉ?
I do not think it is being restored completely. I have examined the figures and I think it falls far short of a complete restoration. I would like to get a definitive answer in this regard.
I would like to refer to the recommendations this committee made to RTÉ to help with public broadcasting. We recommended that retransmission fees should be introduced for companies that enjoy the retransmission of RTÉ material. I am talking about a variety of pay-TV platforms, including Eir, Sky, Virgin Media and Vodafone. Has RTÉ done any work to try to claim retransmission fees from any of these companies?
Mr. Rory Coveney:
That requires a change in the law. The current regime, under section 77 of the Broadcasting Act, would need to be adjusted to enable us to get fair value for the services we provide to platforms. That change has not happened. It is not included in the proposed amendments that are being brought forward by the Minister.
I think that would be a sensible proposal. It would take the burden off. I do not know what Ms Forbes was referring to when she spoke about "Ireland's outdated and inefficient collection system". I assume she is in favour of Revenue being involved the collection of this money, as proposed by Senator McDowell. I voted against that proposal because I am not in favour of any more money being taken from people by Revenue. However, I am in favour of charges being put on social media platforms that gain significantly from advertising. People can watch RTÉ content on those platforms, but they do not have to pay anything in return. Approximately 80% of most advertising is gained by two companies - Google and Facebook. How would the witnesses respond to the introduction of some form of taxation on social media players to fund public broadcasting, which all of us are in favour of and want to defend?
Mr. Rory Coveney:
The Deputy is right to point out that there is a divergence between the domestic players and the international ones. According to a European Broadcasting Union assessment of the market that was conducted earlier this year, the value of digital advertising increased from approximately €100 million in 2009 to almost €600 million in 2018. That money is going largely to two companies, namely, Facebook and Google, which are headquartered here. These massive global players are resident here. The audiovisual media services directive, which is due to be brought into Irish law by the end of next year, facilitates the possible introduction by Ireland or any member state of a system that would, in effect, place a levy on these entities. Such a fund could be used to create an Irish content fund that would invest in Irish programming. We would support such a measure because it would create a much-needed stimulus. I think it should be a contestable fund for Irish programme makers and Irish broadcasters of all hues, rather than for RTÉ alone. There is no doubt that there is an asymmetry between the amount of money that these companies are making here and their relative lack of investment in Irish programming.
I assume Mr. Coveney acknowledges that such a fund could plug a big hole in the finances of RTÉ and public broadcasting in general. If we were able to tax the digital media, it could save 200 jobs and prevent Lyric FM from being moved out of Limerick.
Mr. Rory Coveney:
The question of how public broadcasting is funded is a separate one. In the context of the investment needed by the audiovisual sector in Ireland, this could provide a substantial stimulus and could support the creation of Irish programming. I am thinking particularly of expensive programmes that are hard to sustain in sectors like drama and animation, both of which have a good track record here but are starved of the investment they need.
I recently met some RTÉ pensioners in the context of the fight for the full reinstatement of the public sector pensions that were cut in 2008. Those pensioners, including people who worked in key roles in research and accounts, have not received an increase since 2008. Many of them are living on the breadline. Do the witnesses think anything can be done to reinstate or increase the pensions of former RTÉ staff?
Ms Breda O'Keeffe:
The Deputy has made an important point about pensioners. I presume she is referring to the defined benefit scheme that has been closed to new entrants since the late 1980s. The scheme is in surplus, fortunately, because it has been well managed by the trustees and by the chair of the defined benefit superannuation scheme. It passes the minimum funding standards and the long-term valuation. It is in a relatively good place. As the sponsor, RTÉ recommended a modest increase for its pensioners. We submitted a recommendation to that effect. Under the regulations of the scheme, we cannot authorise any such increase for our pensioners. It has to be approved by the Minister.
Ms Patricia Cronin:
It is approved by the Minister for Public Expenditure and Reform and the Department of Public Expenditure and Reform has come back with questions. It needs to be assured that it is in order to pay this increase to pensioners. The Department of Communications, Climate Action and Environment is engaging with the Department and with RTÉ on this issue at the moment.
On a point of order, I want to clarify that I did not pursue the matter with Ms Cronin because I had forgotten that she is not entitled to speak on the merits of a Government policy. That is why we should have Ministers in here.
I welcome Ms Forbes and her colleagues from RTÉ. I thank them for their presentation. I wrote to Ms Forbes on 24 October on the matter of Lyric FM. I am from Limerick. Obviously, I have grave concerns about the future of Lyric FM. We all acknowledge that public service broadcasting needs to be overhauled. Ms Forbes made a fine presentation about that. The commission is reporting. I understand the Taoiseach has said that as part of today's allocation of €10 million, the board will be asked to defer its decision until the commission reports at the end of next year. I know this has to be put to the board. I think this is a very fair question. I would like to hear what Ms Forbes has to say on it. We are talking about the jobs of 20 permanent people and five or six part-time people. This affects their families because many of them have children in school. They have made a life for themselves in Limerick. I understand that the combined cost of the rental and the rates is approximately €250,000. Many proposals have been made from within Limerick. The greater stakeholder group that was set up by the lead authority, which is the local authority, has made many proposals, including a proposal with regard to the University of Limerick. Other stakeholders have formed a group and are coming with proposals. I would like to know whether Ms Forbes has any comments to make in that regard.
Ms Dee Forbes:
I would like to respond to the Senator's first point. Obviously, I cannot comment on what is being said while we are in here. If there has been some commentary, we will have to consider whatever is being discussed. We will come back when we have heard what has been said. As I said earlier, I understand the concerns of the staff in Limerick. As part of everything we are looking at, staff are being asked to take some pain for the future of the organisation. I appreciate that this is very difficult. We will be engaging with them on the future. We are engaging with them. This will begin in earnest on Friday.
Perhaps I should have asked how it was decided that Lyric FM would be affected. It is as if a circle was drawn around the mid-west, with Dublin and Cork being left out of that circle. How was the decision on Lyric FM made?
Ms Dee Forbes:
In terms of decisions, a lot of complex things had to be considered. The strategy had to address a very complex set of challenges ultimately. We did not start from scratch because we had in place the original strategy recommended by the BAI a number of years ago. As Ms O'Keeffe said, we reduced our operating costs by 25% over many years so there was not much low-hanging fruit left. All of the decisions we are taking now are, therefore, difficult in the sense that they affect the public and staff. Nobody likes to go there but, unfortunately, that is where we are at. In making all our choices, we rooted everything in two overarching principles. The first was whether we can protect and enhance programming for the public and provide good public value, while the second was whether we can protect and sustain jobs. They were the two big pillars that we considered and, within that, we had to make many choices and decisions.
On the rent and so on in Limerick, the rent for our current premises is higher at this point than the figure mentioned by the Senator. We had some discussions with the University of Limerick. Before we renewed the arrangement the last time, we had some good engagement with UL but when everything was considered, our current location was deemed preferable at that point. The Senator is right that we have had a number of approaches since. All those matters are being considered but, again, the staff is the first port of call. That will start on Friday.
There has been a national and international outcry about the proposal. As Ms Forbes has heard from members, this issue does not only affect the people of Limerick. Lyric FM has spread its wings and has a local, national and international listenership. I know it is not proposed to close the station down. Lyric FM has formed partnerships with the Irish Chamber Orchestra and a large number of groups based in the mid-west. If the station is moved out of Limerick those partnerships will be lost because people will be unable to travel to Dublin and Cork. As many as 500,000 people live in the area where Lyric FM is currently based. Many groups and cultural organisations avail of and have formed a partnership with Lyric FM so I am disappointed with the proposed closure. I hope the intervention by the Taoiseach today, in asking Ms Forbes and her board to have a rethink, will help to keep Lyric FM in Limerick. Until the new commission and board report on this matter, it is probably too early to say whether Lyric FM will go.
Ms Dee Forbes:
The important thing in all of this is that we are not proposing to close Lyric FM but to relocate the premises to ensure the service is maintained. We recognise that there will be an impact on staff. However, we must decide what is the best way to ensure we provide a service that is loved globally and locally, as the Senator mentioned. How do we do that within the current financial constraints? Every service we have right now is going to take pain in all of this because we cannot continue as we are. That is the reality of the position RTÉ is in.
I have spoken to the Minister for Communications, Climate Action and Environment, Deputy Bruton, and the Minister for Culture, Heritage and the Gaeltacht, Deputy Madigan, about this matter. The Government is promoting balanced regional development in all areas. If Lyric FM is relocated, we will lose balanced regional development. Limerick is a crucial driver for the whole of the mid-west. It is a shame that RTÉ is considering closing Lyric FM. While I know a kiosk-type development will remain, if this proposal proceeds, RTÉ will be going against the grain with regard to what the Government is seeking. We are seeking to deliver balanced regional development. Six of every ten new jobs in recent years have been created outside of the greater Dublin region. That should also be kept in mind.
Mr. Rory Coveney:
It is useful to step back from the context of this matter. RTÉ is operating with €100 million less total revenue than it had ten years ago. It is trying to maintain as many of its services as it can across the country and in Dublin. If we take our regional footprint, we have taken a range of measures to try to maintain our presence around the country through a series of relationships with the institutes of technology in Galway, Athlone and Waterford. Our regional commitment is strong and we will continue to have a mid-west bureau in Limerick, whatever happens with regard to a decision on Lyric FM.
Ms Forbes mentioned that there is no low-hanging fruit. We have made major cuts to children's programming and drama. Our commissioning expenditure has halved in ten years. The notion that we are targeting Lyric FM is wrong. We have been left with very difficult decisions which affect stakeholders, individuals and audiences. As we have made all of these decisions, we have tried to keep audiences at the forefront of our decision-making and to protect and sustain jobs in a sector that is haemorrhaging jobs by the minute because the whole model of sustaining journalism through advertising is under stress.
I appreciate the sincerity of the Senator's contribution on Lyric FM and we are very sensitive to the 20 or so staff who work in the station, this issue arises in the context of a series of difficult decisions. We are trying to protect and sustain a public service, including Lyric FM, while utilising, as best we can, our regional and studio infrastructure in Cork and Dublin.
I understand that Lyric FM is one of the most cost-effective stations and costs a lot less to run than some of the other stations. The salaries of some RTÉ presenters was raised. Why impose cuts or changes on Lyric FM when it is more cost-effective than some of the other radio stations?
Ms Dee Forbes:
As we mentioned, under this plan, every service that RTÉ is operating will take some pain because we have to act. We have to look very differently at the models and how we work, especially our music channels. For example, we said that we could no longer sustain our digital audio broadcasting, DAB, stations because there is no policy for DAB in this country. We have maintained stations over the years but we simply cannot do so any longer. All of our stations have different objectives, remits and obligations. While I appreciate that Lyric FM is cost-effective, in the grand scheme of things, everything we are looking at right now has to be even more cost-effective given that we have €100 million less revenue than we had previously. Everything is and must be under consideration.
Mr. Rory Coveney:
On the relativity between the different stations, Radio 1 and Radió na Gaeltachta are talk-based stations. They have a different resourcing level for production teams. Music stations, by definition, are different and require fewer people to run them. It is a different type of programming, which is the reason the costs are a bit different.
I welcome Ms Forbes, Ms Cronin and their respective teams to this very interesting meeting. We are all deeply concerned about the cutbacks taking place in RTÉ because we all respect the company and the service it provides. RTÉ's coverage of Brexit, for instance, through its correspondents in Brussels and London, kept us up to speed with developments. RTÉ provides a public service and we, as a society, generally view it as our broadcaster. We are all in this together. This committee spent considerable time in discussions and brought forward very strong recommendations. The Chairman is very patient and brought through a very good report, about which we may not all be madly keen because nobody wants to charge people.
One of the biggest problems at the moment is that we are facing an early election. I predict it will take place on 22 February 2020.
RTÉ provides great coverage of elections on radio and television. The programmes are much watched but the service will cost more money. Has RTÉ set aside money for an election?
"RTÉ Investigates" has been doing enormous work. Sometimes it is better than Governments at finding out things, such as on the matter of children's care. It is terrific work and public broadcasting at its best.
How many freelance workers work at RTÉ, leaving aside the ten? I appreciate they generate a lot of revenue. They also pay taxes, they have no security of tenure and they must buy their own pensions. It is not all one way traffic in this regard. They draw in revenue from advertisers and the witnesses know this. We can do a cost analysis and find out the ten top paid broadcasters bring considerable revenue to RTÉ. I will leave this aside because it is too easy a target. What will be the policy governing the freelance contract sole traders?
I will try to bring together a few questions to save us going back and forth. The sole traders are broadcasters who are well known but they have no permanency of tenure. They are deeply concerned about their future. I understand the proposal that has been made is that they will be laid off and some have been notified already. Do the same criteria apply to sole trader freelancers in RTÉ regarding the length of time they are allowed to stay? Some have been given a little extension in time. Why are sole traders singled out, especially if they continue to produce very high quality work? It is of deep concern to the sole traders. My previous questions were general but this is specifically with regard to freelancers and sole traders working for RTÉ. Some of them have been working there for 25 or 30 years and, to my knowledge, there will not be any pensions involved. Do the witnesses have a rough idea of how many of these individuals are top broadcasters on all of the platforms?
Ms Breda O'Keeffe:
I will answer Senator Leyden's questions as best I can. RTÉ contracts a broad range of third-party contractors in all of our services, be it radio or television. The extent of the services depends on the type of service being provided. They could be on-air presenters, production staff, video editors, camera men or camera women. There is a broad range of services and not just on air. We have just a little under 500 sole traders and limited companies that provide contracted services to us. They are for a range of duration. They could be for a short period, a specific event such as the "Late Late Toy Show" or a longer duration. The level of spend varies with each of them depending on the services provided. There is a broad range of services involved.
Would RTÉ like to give some help to people who have been broadcasting for so long and have such loyalty to RTÉ? I understand they have been informed their contracts will be terminated quickly. Will any of the €10 million announced today that will be invested by the Government go towards freelancers? Will it be absorbed in the overall situation?
Ms Breda O'Keeffe:
RTÉ undertook a very extensive and comprehensive contractor review in late 2017 and early 2018 with the help of Eversheds Sutherland. We reviewed all of our contractors, and we had more than 433 contractors at that point in time, to review the nature of the services they were providing, the nature of the relationship and what would be a more appropriate relationship with RTÉ. The initial report from Eversheds Sutherland was that the majority of the contractors were contracted appropriately by RTÉ and that a smaller proportion required further review. Over the past 12 months, we and Ms Cusack have undertaken a review of the individual arrangements we have. It is not one size fits all and there is the nature of the service, the duration and the fees. As Ms Forbes mentioned earlier, many of the contracts came about when the integrated business divisions, IBDs, in RTÉ were split. There were different ranges of service. We are almost at the end of that review. It has been a very comprehensive and long process in which we have invested a significant amount of time and resources. We have introduced new policies for engagement with contractors. We hope to have that matter concluded early in the new year.
I thank Ms O'Keeffe. I note the Minister of State, Deputy Breen, wrote a letter to Lyric FM staff stating that as part of the €10 million funding announced today the board of RTÉ has been asked to reconsider or defer the decision to relocate Lyric FM from Limerick until the new commission on broadcasting reports next autumn. In fact, it is not reporting next autumn. It will report in 2021 as far as I can see. One arm of government is saying RTÉ cannot close Lyric FM because it received €10 million. I know all of the Deputies and Senators from the region are very concerned about the situation and it would be a popular move to adjust it to whatever is possible to retain at least a majority of it in Limerick.
Some Deputies are very concerned because an election is coming up next year. As Senator McDowell said, no decision will be made because the Government is afraid of the electorate, it will hang on until the election and when there is a change of Government, which there probably will be, it will have to grasp that nettle. That suits the present Government. That is fine.
With regard to regional development and regional services I commend RTÉ's regional representatives, such as Ciaran Mullooly and others who represent the midlands and north west. They do a great service. Recently, when it came to an issue in my county, which was the closure of Cuisle Accessible Holiday and Respite Care Resort run by the Irish Wheelchair Association, only for the regional representatives it would not have got coverage. In fact, I must say it is worth checking whether censorship was operated on "Claire Byrne Live", "Drivetime" and all of the platforms. Not one of the stations gave any recognition to the depth of anger about a national service being closed down without consultation. I was disappointed, although not with the regional representatives. Claire Byrne was going to feature the story but all of sudden it was gone.
I thank the guests for their contributions so far. With regard to the commission announced by the Government today, it will make recommendations on the role, financing and structures of RTÉ. Does Ms Forbes feel her plan has been undermined by this announcement? Will her plan now change? Where is the credence in her plan? It seems a lot of what she announced a month ago has either been taken off the table by the Government or is being debated. Will we see a new plan from her, the board and the senior team? Will we have to redo what we are doing now in a few months time? I would like Ms Forbes to comment on this point.
Ms Dee Forbes:
The commission announced today is welcome because apart from the work done by this committee there needs to be proper national engagement on the future of public service media, its role and the wider ecosystem of the audiovisual sector supported by public service media. We are reading what was announced before we came in here today. There is no doubt what it has been asked to do will probably influence further decisions down the road for RTÉ. At the same time, we have work to do. We have to reshape ourselves as an organisation and this is under way. We have to take costs out of the organisation.
We have to pivot ourselves for audiences of the future and that is already under way. I am sure further things will come out of this review. Ultimately, at the centre of this, there needs to be a final decision on the funding of public service broadcasting and whatever that is to be. As we said, for RTÉ to be financially stable, there needs to be a clearer definition of how the funding will happen. We need to cut our costs, as we have outlined, and we also need to stabilise our commercial revenue. Those three things have to happen-----
I think the majority on this side accept that and support licence fee reform. When going through the figures, my colleague, Deputy Dooley, mentioned that in the plan that has been published, there is a €10 million gap. Is that correct?
Ms Breda O'Keeffe:
We developed our strategy in line with the recommendations of the BAI. The BAI recommended that RTÉ would immediately receive €30 million, but it did not restrict it at that. It said RTÉ should immediately receive at least €30 million of public funding, and then it would consider additional public funding beyond that. That was what we based our plan on, which was the recommendation from our regulator. Roughly, €10 million has been reversed, in terms of the cuts in previous years, as Ms Cronin outlined, and €10 million from today, which will deliver about €9 million to ourselves. That leaves a gap of somewhere between €10 million and €12 million.
Ms Breda O'Keeffe:
I do not have the band for €200,000 but we publish our salary bands on our website, as we publish quite a lot of other information. The salary band that I have here is between €150,000 and €250,000, and there are 27 people in that band. There would obviously be a smaller number in the band of €200,000. I do not have that specific breakdown here, although I can get it.
Ms Patricia Cronin:
The discussions around the commission were in the context of the serious financial situation that was brought to Government in respect of RTÉ. As part of that discussion we dealt with other Government Departments about doing something broader in terms of a review of public sector broadcasting. In our statement of strategy we always intended to do a review of public sector broadcasting. It is in our published strategy. Effectively, what we have done is bring forward what we were going to do anyway.
I would like to focus my contribution on Lyric FM, as I am Deputy representing Limerick city and this is a huge concern in the area. It has been a good project in the city. When RTÉ brought Lyric FM to Limerick, it was seen as the national broadcaster reaching out to the regions. Now that RTÉ is retreating from that, the opposite is going to be perceived. It has not, as one can imagine, gone down well in the constituency.
I was really disappointed with Ms Forbes's answers to my colleague, Deputy Cullinane. If RTÉ has decided to move Lyric FM from Limerick, she must know how much savings it anticipates to make from that. Ms Forbes said she cannot tell us what the savings will be, even though she said the figures are with the Department. She would have understood that we were going to ask that question today, so it is perplexing to me as to why she cannot tell us that. RTÉ is moving Lyric FM from Limerick. What I have been led to believe, and Ms Forbes cannot tell us the amount of savings, is that RTÉ is going to split the station between Dublin and Cork. The concern we have is that RTÉ wants to get rid of Lyric FM by splitting it between two areas where it will not be as strong as it was in Limerick. How can RTÉ justify it being cheaper to run Lyric FM anywhere outside Limerick? I would imagine that Limerick was the cheapest place to run it from. I ask Ms Forbes to answer that question and to tell the committee what she anticipates the savings will be.
Ms Dee Forbes:
A lot of the programming on Lyric FM comes out of Limerick, Cork and Dublin. Lyric is already served by three locations. That happens right now. While the majority comes out of Limerick, other programming comes out of Dublin and Cork. As we said, these are difficult choices. We have an awful lot less revenue than we had a number of years ago. We are operating at deficits, which we have been asked to stop doing. We cannot do everything, as we have done. Hence, the most important thing in all of this was to make sure that we could maintain a service. The proposal on the table right now is that that service can be maintained by splitting it between Dublin and Cork. Since we have come in here, something has been said in the Dáil so we have to review this in light of all that.
In terms of the overall savings, I do not want to appear evasive but there are a number of factors at play that depend on the outcome of consultation with staff. That is why I do not want to get into a specific number because that number is variable depending on what will happen. I hope it is sufficient to say to Deputy Quinlivan that the saving would have to be significant for us to consider it. The level of financial crisis we are in requires us to take a number of decisions that collectively will create a large number. Sometimes that means taking lots of €0.5 millions or €400,000s from various places to come up with an overall number. That is the place we are in. There is no silver bullet whereby we can say that by stopping this, we can achieve the savings. It is a complex mix of a number of things. As I said, ultimately, we want to protect the service for the audience.
Ms Forbes has not answered the question I asked. There is concern about why RTÉ thinks it is going to save money by moving to Dublin or Cork. RTÉ is reducing what Lyric FM will be, otherwise there will be no savings there. Limerick is probably the cheapest place to run it. Ms Forbes, if she has ever been to the Cornmarket, will know how big it is and how cheap it is compared to Dublin 4, for instance.
On the issue of staff finding out about this through the media, whose fault was that and how did that happen? It was disgraceful that people who were committed to RTÉ and to Lyric FM found out about this from media reports. Ms Forbes told us earlier, and correct me if I am wrong, that RTÉ will start to engage with staff, starting on Friday. It is two months later and this is the first discussion RTÉ is going to have with the staff of Lyric FM. It is treating people with contempt and it is not good enough.
Ms Dee Forbes:
On the Deputy's first point on how this happened, I was as upset as everybody else at the way this happened. The information leaked. I do not know where that leak came from. We got a phone call at 7 p.m. from a newspaper outlet telling us that it had the plans. We had to get into action very quickly because our priority was our staff and nobody wants to read about their future on the front page of a newspaper. We did what we could very quickly. We spoke to people in Limerick and we spoke to the people affected in Dublin. The next morning we had a meeting with all staff to try to address as much as we could. Admittedly, this is not the way it should have happened and it certainly was not the way we had planned. That was regrettable from day one. Of course, there are ongoing discussions with the staff, but the detailed discussions, in terms of the consultation, begin on Friday. That is where we are in the process.
I refer to the Taoiseach's comments today, which Ms Forbes said she has not heard. He said that the Cabinet agreed that it would ask RTÉ to defer the closure of Lyric FM until after the report is done. Would Ms Forbes's gut feeling be to do that?
I thank Ms Forbes and the other witnesses for coming before the committee. Does Ms Forbes accept that the idea of a ringfenced tax to fund public service broadcasting in general, and RTÉ in particular, may be an idea that has run its course when we do not have, for example, a housing levy to deal with the crisis of homelessness that we face or other more acute problems we face as a society?
Ms Dee Forbes:
Excuse me, I apologise. Many years ago it was decided that Ireland should have a public service broadcaster. It was deemed at the time that it should be funded by commercial income and by public money. That model served the country well for many years. What is now up for discussion is how that should be funded in the future. I certainly believe, and I hope the committee agrees, that public service broadcasting is vitally important. What we, as a country, have to establish is that if we all agree with the fundamental principles that there should be a public service broadcaster, then the funding of it needs to be confirmed, because it is impossible to plan and to project.
Part of the difficulty here is that people have a difficulty in their minds deciding what is public servicing broadcasting and what is not. I refer to a block grant approach. This commission will help us, as a society, to have a more serious think about what elements are indispensable. Objective news and current affairs would seem to be indispensable. The public, however much it might like the likes of "Fair City", is uncomfortable with the idea of public service money - public funds - being involved in any way, directly or indirectly, because one is dealing with the principle of fungibility of money here. That is why I am trying to tease out whether the future is about neither a digital broadcasting charge nor, indeed, a licence, but about a block grant from Government to cover what are considered essential public service activities. Does Ms Forbes have any metrics? Does RTÉ have a means of measuring, or a distinction, within the organisation? If there is, as I understand it, €189 million coming from the licence and about €150 million coming from advertising, does RTÉ distinguish in its budgets between what can be called its public service and its non-public service broadcasting remit? Which is funding the other, as Ms Forbes sees it, or according to whatever metrics RTÉ has?
Ms Dee Forbes:
In our annual report, we publish how we cover the costs of each individual service. We allocate moneys to each service from the licence fee first and foremost, and then it becomes obvious what has to be effectively topped up by commercial revenues. That is in our annual report. We can take the committee through it if it would like to see that.
Currently, I am working with the Office of the Parliamentary Legal Advisers on possible Private Members' legislation that would regulate the issue of higher pay, such that it would be linked to public service pay scales. I have been surprised at the positivity that I have received to that proposal, not from the public where one might expect that there would be a lot of people who would agree with that, but among journalists. It seems to be that there is something of a morale issue in RTÉ, and not just around what the top earners are getting, which is seen to be way in excess of the top public sector pay scales. I have heard the phrase "yellow pack" from different cohorts within RTÉ about staff who are paid much less favourable rates than others who have been in the organisation for longer. We have had the recent public disagreement between the local union representatives in RTÉ and the national representatives, and a certain amount of briefing on both sides about that. Would Ms Forbes welcome legislative intervention that would respect RTÉ's independence as a broadcaster, but set the parameters that would have the effect of limiting the pay on offer at the highest levels?
Ms Dee Forbes:
On that point, and going back to the opening point, RTÉ is both public service and commercial. We have two very clear objectives, and given that fact, it is not as clear cut. The BBC, for example, is 100% public service. It gets no money from advertising. It has BBC Worldwide, of course, which is a commercial arm, but it is different in that respect. If that were to happen, there would have to be a fundamental change in everything to do with RTÉ in terms of the remit and particularly on whether or not the commerciality of it is viable.
I thank Ms Cronin. I want to bring the debate back to Lyric FM, because like so many others who have spoken, I am completely perplexed. The staff in Lyric FM in Limerick are completely perplexed as to how much savings can be made, and the fact that to date - despite several people asking - we have received no answer in relation to the possible cost savings, which only adds to our frustration. I want to ask Ms Forbes, in particular, about this because the staff have been extremely frustrated about the lack of information and communication from RTÉ over the last couple of months. On Friday when Ms Forbes meets with them, will she share the financial data they have been looking for in relation to the supposed cost savings of closing Lyric FM in Limerick?
I want to make another point. Ms Forbes mentioned the three areas, namely, Limerick, Dublin, and Cork. My understanding is that 80% of the programming of Lyric FM is either delivered or produced in Limerick, and as the union representative said at the Oireachtas briefing a couple of weeks ago, Lyric is Limerick. This is not something that is shared between the three in an even fashion. It is largely Limerick. It is completely unacceptable, and I am really hoping that given today's announcement, RTÉ will reverse this decision. Again, a simple "Yes" or "No" will suffice but will Ms Forbes confirm that she will share the financial data of the supposed savings that she is talking about when she meets the staff on Friday?
Ms Dee Forbes:
The discussion on Friday will be quite varied, as one can imagine, and we will be starting from the premise that Lyric FM costs us around €3.5 million. That is the cost of Lyric FM today, so what we have to do is to look with the staff at where we can make reductions to that cost base. That will be the starting point.
Between 2008 and 2018 the moneys received by RTÉ form the licence fee fell by 6%. In the same period, the licence attribution fee to RTÉ Lyric FM fell by 26%. Why was the arts and culture funding so disproportionately cut?
Given the overwhelming levels of support for RTÉ Lyric FM shown over the past three months, and we would all acknowledge that, why is RTÉ's response to that to close the station's production facilities in Limerick and so to strip its service.
Given the cost differentials between Limerick and Dublin, was it considered to move staff from Dublin to Limerick rather than to close Limerick, which we acknowledge is responsible for 80% of Lyric? It is a devastating decision which needs to be reversed. Was any consideration given to decentralising, which would have been much more in line with Government planning?
I am going to move quickly because I know we are under time pressure. There was an announcement this afternoon about a new commission on public service broadcasting, which is to be initiated. I am not sure if the officials here can talk to that in any detail. I understand they may have been caught short on it themselves in terms of the timing of the announcement. The Chair, myself, as Vice Chair, and the other members of the committee put quite a lot of work into a public service broadcasting review and report. We had quite a large-scale event in Dublin Castle and we produced a report. I hope we are not reinventing the wheel with this, so perhaps the Department officials would take that back to the Minister. We have heard a lot a talk about Private Members' Bills in the House, but I hope the work of the committee and the cross-party group and the really strong policy initiative from the committee will be taken on board and that we do not have to start from scratch. There is a lot of good work already done on that.
I have a couple of questions for Ms Forbes, and I thank RTÉ for coming in today. The first question is quite fundamental. It comes up a lot in debate and sometimes it is described as nit-picking. I refer to the model that RTÉ is talking about moving towards. I heard Ms Forbes in many interviews around the time of the recent RTÉ announcements. In one way, they showed RTÉ at its best in terms of public service broadcasting, challenging debate, internal debate and not being afraid in regard to the subject matter. Ms Forbes mentioned in many of the conversations, the new vision, the RTÉ Player, online and moving to that space. I suppose I am not seeing that backed up by action and reality. Is there enough funding, for example, for digital channels, digital content production and digital delivery? I refer in particular to the RTÉ Player. We have all had experience of the RTÉ Player and this issue comes up again and again, but it comes up because it is real. I have had experiences with iPads and other devices of trying to use the RTÉ Player and eventually just having to fold the towel and walk away in disgust because it does not work. It seems to get stuck on ads ad infinitumin a loop. Is there anything at play in terms of that? This is sometimes seen as nit-picking, but it is fundamental to the change Ms Forbes described and RTÉ being serious about becoming an online portal and an on-demand portal. That makes a lot of sense, but RTÉ is really far away from that. Where is RTÉ on that digital delivery and what measures does it have to improve that?
Ms Dee Forbes:
On the broader point on digital per se, one of the key factors the last number of years has been our transition to become a digital-first organisation. Deputy Dooley mentioned earlier what we had done over the last number of years, and I think news has been at the forefront of that in terms of becoming a digital-first organisation, whether it is through RTÉ News Now or rte.ie, and that whole approach to servicing the public digitally first. Ten years ago, one would have held back the story until the "RTÉ News: Six One" but now it goes out as it happens. There has been a huge investment in news and around our capability in that area. That is already showing pretty good dividends. RTÉ News Now has been averaging about 100 million page views, for example, so we have seen a huge trajectory growth.
We have had some issues with the RTÉ Player. The issues have been twofold. The technology is moving at an incredible pace in terms of development. We have to invest more in the technology and we have committed to doing that. That is the first thing. The second thing is that the complexity of what the RTÉ Player offers versus let us say Netflix is very different, because we are offering both on-demand content, so one can watch a box set, but we are also live-streaming, so one can watch a match, "Fair City" or whatever live. That has been the huge growth area for us in the last year. Again, that requires better infrastructure. It also requires us to think differently internally. It has been a huge learning curve, and I am disappointed that the RTÉ Player has had issues, but we are in a technological place that is advancing at a huge pace, and we have committed to develop and to spend more money on that.
Mr. Rory Coveney:
RTÉ has been delivering linear services on television for 50-odd years. We spent hundreds of millions of euro in infrastructure, towers en masse, and we have hundreds of people who do nothing but try to get the signal to people's homes in high-definition. On the shift we have announced in the strategy, in one sense there is a lot of focus on the cost-cutting elements, and that it has been the case here. The shift to on-demand is the big challenge that RTÉ has to wrestle with. As Ms Forbes mentioned, the shift is technically very difficult, and it is costly in terms of the investment made. Disney, one the most well-resourced media companies in the world, just launched Disney+ a couple of weeks ago with great difficulties in streaming in the first couple of weeks at the types of scale we are used to. We are very acutely aware we have things to do in improving RTÉ Player, but it is a big part of our future and it will require a multi-annual investment over a number of years to do that.
I thank Mr. Coveney for that. I have one brief follow-up question which is quite fundamental. In the debate that took place in the Dáil Chamber a few weeks ago and on many other occasions, I have expressed a view - I think Deputy Dooley and other members of the committee share it - that in terms of public service broadcasting there is a general consensus that it is a public good. Public service broadcasting should be protected and should be funded. I think where the divergence comes is that it does not have to be RTÉ that delivers it. There is no reason we could not commission a model - perhaps this commission will end up with that finding - where a charge is collected, put into a pot, and indigenous content producers draw down from it. RTÉ has had the lion's share, has had the head-start, for the last 80 years or whatever number of years. It really has to get up to the mark now in terms of staying there. How does it respond to that, because it would be very easy for policymakers to start sharing wealth? RTÉ is on the back foot now in terms of how it justifies retaining that.
Mr. Rory Coveney:
In one sense, the commission is welcome. These are questions which need to be teased out, namely, the structure of the funding arrangements, the operators, what public service means and so on. There are examples of what Deputy Lawless is talking about, of creating a contestable fund for broadcasting. In New Zealand, for example, it has led to a massive diminution of public broadcasting. A series of reviews has been done on it. Where one just breaks up the money and a grant-giver just allocates it to individual programme makers, one loses all sorts of benefits in culture and in an integrated newsroom that delivers news reporting across multiple channels. I am sure many of these issues will be teased out in the context of this upcoming discussion. Many of them were already teased out in the context of the committee's report, but Deputy Lawless is right to ask the question.
I listened with interest to the case made by the director-general, but despite the presentation, which was very professional, the truth is that many people believe RTÉ is self-satisfied, bloated and Dublin-centric. I have a number of questions for the Department. A report done by An Coimisinéir Teanga said that RTÉ was not fulfilling its statutory obligation in relation to Irish language broadcasting on television. Is it intended by the Department to strengthen the legislative provisions in relation to what is public service broadcasting, that is, what are we paying RTÉ for? Has the Department commissioned any reports or studies on the comparative costs of, for example, an hour of TG4 producing iSport versus RTÉ, an hour on TG4 of documentaries versus RTÉ and an hour of light entertainment on TG4 compared to RTÉ, to see how RTÉ compares per hour in terms of output, allowing the TG4 to have higher costs because it is doing it in a minority language?
The next question for the Department is as follows. RTÉ was given €10 million today but were the needs of TG4 taken into account in deciding whether there be a fund for TG4? Is it a case of the crying baby getting the bottle? I think many of us might believe that that was the case. The Department is reviewing public service broadcasting. For many people in rural Ireland, public service broadcasting in terms of news, sport, etc., is complemented hugely by local radio. Is it intended to consider giving State funding directly to subsidise the local equivalent of the national equivalent in terms of news, sport, current affairs, etc.?
Can RTÉ explain why the salaries of the staff for comparable grades in RTÉ Raidió na Gaeltachta are lower than those in RTÉ 1 and RTÉ 2 for the same grades?
Ms Patricia Cronin:
I might start with Deputy Ó Cuív's last question on how broad the terms of reference will be for the review of public sector broadcasting. The terms of reference are going to be quite broad. They refer to identifying what the Irish experience has been in delivering the above aims through public sector broadcasters and other media outlets at local, regional and national levels.
To answer the Deputy's question, it will be a very broadly based review and it will look beyond RTÉ. My colleague, Ms Quill, will cover the first two questions which would also be within the remit of the regulator, namely, the BAI.
Ms Triona Quill:
On the metrics regarding TG4 and RTÉ this is something the BAI would look at every year in the annual reviews it carries out. Each of the services provides a set of annual performance commitments. In terms of looking at that, the regulator would review the performance of each of the services and undertake quite detailed analysis of the relative efficiency and a quite number of metrics in relation to both RTÉ and TG4. Therefore, much work has been done there in terms of the annual reviews the BAI carries out.
I refer to the legislation. Is it intended to strengthen the legislative provisions in relation to public service broadcasting, which is what we are talking about? It is not in the legislation at present.
I thank the witnesses for coming in. I ask Ms Forbes if RTÉ has commissioned a study of the landbank in Dublin 4 in relation to the potential to dispose of it, relocate, and the cost associated with that. This is in the context of RTÉ having already disposed of part of the land, so clearly it was thinking about it. We have been talking about decentralisation and my colleague, Senator Byrne, mentioned the Lyric FM issue and the cost questions that are associated with that. I understand the variance there, but given that there are so few staff I find it hard to believe that there is a cost saving to be made on that one but I will defer to Ms Forbes. Could she answer that question on the landbank and any study that RTÉ has carried out?
Ms Dee Forbes:
A number of years ago before we embarked on the first sale of land there was a comprehensive study done to look at the overall size and the value that could be gleaned from a land sale. At that time it was decided that we would sell the portion that we sold, and that was completed back in 2017, I believe. As we were planning this current strategy, or as we were going back to look at the revised strategy, we looked again at Donnybrook, in particular. We asked whether there be a way of relocating from Donnybrook and creating something bespoke somewhere else. The very short answer to that was that we looked at it but the maths were very difficult to add up. While the first tranche of land we sold was effectively a greenfield site, and it generated a very good cost per acre, the rest of the site is far more complex and the same values would probably not be realised.
Perhaps another day we could drill into what constitutes complex land in Dublin 4. I am asking about the cost of relocating versus retaining a multi-million euro Dublin 4 site that Ms Forbes inherited. I understand this is not of her doing. Would Ms Forbes accept that a site anywhere else would be more advantageous in terms of the cost? If RTÉ were to dispose of Dublin 4, it would provide a huge nest egg to put towards the cost of relocating to somewhere that is not Dublin 4.
Ms Breda O'Keeffe:
It depends on what one is replicating. We have looked at the cost of this. The cost of replicating the production facilities we have in RTÉ, or of replicating slightly fewer facilities, in another location outside the greater Dublin area would be a really significant. There is also the price of land in the current market. Construction costs have gone up-----
In terms of the cost base of the total revenue streams and the future of RTÉ, it is very clear that something has to change radically, and it is going to change very quickly. There is an opportunity with what has been set out by Government in terms of realising savings and-or improving the model. What I would like to know, as somebody who is hugely supportive of what RTÉ does, particularly its news media, is that Irish taxpayers have certainty over this. The 10% efficiency in terms of the collection of the licence fee, for instance, does not even come close to plugging the gap. Through the actions of these Houses, are taxpayers looking at moves to give this collection role to Revenue to bridge the gap? Are they looking at an increase in the licence fee? How is it going to work for the consumer of RTÉ's stations or of its product?
Mr. Rory Coveney:
We would like as much certainty as the Deputy is seeking in relation to the future. Is it going to be a combination of cost reductions and stabilising commercial revenue, both of which are within our responsibility? It will require some brave decisions about the public funding of what most people here accept as a valuable resource.
I will be brief. I am not a member of the committee, but I welcome the opportunity to ask questions. I recognise that RTÉ has to deal with its financial difficulties and I support it in relation to the need for licence reform sooner rather than later.
My questions mainly relate to Lyric FM and the proposals to move the service to Dublin and Cork. I welcome the fact that RTÉ is going to have detailed discussions with the staff on Friday. I also welcome Ms Forbes's indication that she would consider the request of the Minister to defer the decision on the transfer of Lyric. Could she confirm that, although I know she has not had a chance to look at it yet?
In listening to the responses, she referred to part of the reason for moving Lyric being excess capacity in Dublin and Cork. Would it not be better to deal with the excess capacity in Dublin and Cork rather than transfer Lyric from Limerick? I wish to reiterate the points around regional balance, and the hugely important cultural role that Lyric FM plays in the Limerick area and in the mid-west in general.
I know the witnesses were not able to specify the exact savings but there was certainly an implication - it might have been on a radio interview rather than here today - that part of that might be redundancies. For people who cannot afford to move their families to more expensive accommodation, not to mention all the other elements of moving a family from Limerick, I would not describe this as voluntary redundancy but as forced redundancy. I ask that RTÉ do take that into consideration because there are many people who are working in Lyric in Limerick who are living in Limerick, have children going to school there and so on.
Finally, I wish to ask RTÉ about the offer from University of Limerick. Ms Forbes mentioned using facilities with higher educational institutions in other parts of the country. I know there was a response to the effect that this was not suitable but I ask RTÉ to look at it again as a possibility. The institutions might be able to reach some kind of compromise with RTÉ to facilitate its needs in Limerick. The witnesses have heard today that across the parties, we feel very strongly that Lyric FM is really important to Limerick. It is obviously important to its listeners all over the country but it is also important to Limerick and the region.
Ms Dee Forbes:
To respond to the Deputy's point on what was said while we were in here, again, we must look at that. Of course, we will consider whatever has been said and come back on it.
We had good engagement with UL about the premises. When we put everything into consideration, where we were on Cornmarket Square was deemed to be the better location vis-à-viswhat the university was suggesting. This is why the UL piece did not come to pass. We renewed the lease on our current premises rather than moving to UL.
Ms Dee Forbes:
In all this, we foresee that about 200 people will leave RTÉ. These redundancies will be on a voluntary basis. We will look for redeployment where possible as well. This is why the discussion with staff is a consultation. It is a very important one and we will work with staff to come up with the best solution possible for them. It will be voluntary.
I will make a couple of final points. I, too, lend my support for the retention of Lyric FM in Limerick. I hope the decision will be taken on sound grounds rather than on a request from the Taoiseach. It would not be appropriate for RTÉ to make a decision based on a request from the Taoiseach just because he is ponying up €10 million of taxpayers' money. The business case stands up and I certainly would not want to think there is political interference here or that this will play into some kind of grandstanding by the Government in that regard. It makes absolute sense and is appropriate that Lyric FM be retained in Limerick. Ms Forbes has been strong in the past on support for the regions and has identified again today the importance of that. It works well.
I wish to follow up on what my colleague, Senator Leyden, said. There is a very strong level of engagement in the regions. This is just my observation but I think RTÉ has upped its game. Perhaps this has just happened because there have been more stories; perhaps it is strategic, which would be great. Even on weekends, I see RTÉ doing a lot more regional stuff. That is what we want to see. As the removal of Lyric FM from Limerick would undermine what has been developing and working really well, I hope RTÉ can find a way not to do that. Lyric FM is a signal, a presence, in Limerick. I know it has studios in other regional technical colleges, RTCs, and that may be fine where it did not have a presence previously, but the removal of Lyric FM would be seen as a reduction. I will not speak for the people in Lyric FM - they will be more than able to represent themselves - but I will speak for the people I represent, who see the RTÉ brand within the city of Limerick as speaking to the entire mid-west. It is important that it be maintained.
I think it was in the Committee of Public Accounts that Ms Forbes previously talked about changing RTÉ's policies on the engagement of freelance contractors. Where has RTÉ got on that, and what are the cost implications? Will RTÉ save money or will it cost it more money to do that? Ms Forbes also indicated the cutting of content in RTÉ's cost savings and the reduction of numbers. We all know people who work here, in RTÉ and around Leinster House. People say to me there is very significant pressure in some areas within Ms Forbes's organisation - perhaps Ms Cusack will know more than anyone about this - in that there is not enough staff at certain times to deal with sick leave, maternity leave and so on. It seems to me that reducing numbers could put very significant pressures on RTÉ's capacity to continue its current output. There is that issue, what happened in Limerick and the way in which everything was leaked. How does Ms Forbes view morale within the organisation at present? Could she speak to that?
Ms Dee Forbes:
As the Deputy has pointed out, a lot has happened and is happening. There is no doubt but that morale is low because there is so much uncertainty. This uncertainty has been around for a while, to be honest with the Deputy, because the industry is going through huge change. We have been adapting ourselves to reduce our costs, reshape ourselves and restructure ourselves. At the same time we have been looking to shore up our commercial revenue but nothing has happened with public funding. We are therefore in a very difficult position in that regard and, to be very honest with the Deputy, we will be in that position until we get further confirmation on the future because we cannot plan. Half our funding is under considerable vulnerability on a month-by-month basis. We are seeing returns from the licence fee go down month on month and we do not know the position until that month's returns have come in. We desperately-----
Ms Dee Forbes:
What we are facing as an industry is unprecedented. Also, looking at the media industry in the context of what is happening in the Irish economy, it is an outlier in the sense that there is so much uncertainty and change. This is happening globally. There is no organisation in the media world right now that is not going through what we are going through. Everywhere there is a question about longevity, morale and sustainability. It is a factor of the industry we are in, unfortunately, and that is symptomatic of where we are.
I was hoping there was some kind of plan to address that. Sometimes it is a matter of accepting the reality, like "newsflash - we are all going to die". A crisis can be viewed as an existential one or just problems to be solved, working on morale. Perhaps this is something to address. What is Ms Cusack's view on the freelance contributors and the implications?
Ms Eimear Cusack:
We have introduced a fairly robust policy on the engagement of contractors. It came into place in January. All our managers have been trained and we have a fairly rigid approval process to understand the contracts under which people come into the organisation. In the main, unless someone is coming in as a freelancer for a specific purpose, in which case they disappear afterwards, maternity leave cover and so on is fixed-term and fixed-purpose. There is therefore fairly tight governance around this now.
Ms Eimear Cusack:
Yes. We have undergone a fairly comprehensive process. We engaged Eversheds Sutherland as far back as 2017 to look at our contractor population. More than 400 contractors were reviewed, the majority of whom were deemed to be appropriately engaged. A further review was carried out on a further number and we have been in the process of offering contracts of employment. That process will conclude probably early in the new year.
I welcome Ms Forbes. I welcome the fact that she has acknowledged the €9 million coming from Government and that RTÉ will receive it very much in the spirit in which it was given by the Taoiseach, in that RTÉ will defer any decision on Lyric FM until the broadcasting commission reports.
I wrote to Ms Forbes in November, specifically about Lyric FM and where it is based. I perceive Lyric FM and RTÉ news broadcasting to be twin pillars in Limerick city. They are in the heart of the city and are hugely important to us. Apart from the staff and what they bring, having a national broadcaster like Lyric FM based in Limerick city, which is a cultural city, is hugely important. I have been in and have broadcast from the state-of-the-art studio many times. It is probably the next best technical studio outside of headquarters in Donnybrook. RTÉ broadcasts regionally in one section of the building and Lyric FM in the other. Lyric FM itself does not require that level of space in the building at the moment and there are also archives stored there that are not required. I made contact with the owner of the building and I asked the direct question as to whether RTÉ had engaged in discussion with him about downsizing that particular floor, because it would cost a huge amount to dismantle. He stated it was not discussed. As he extended the lease to December 2020, I ask that RTÉ now engage with the owner of the building to look at the floor area, to retain the RTÉ regional broadcasting studios as they are and to downsize the floor area for Lyric.
Ms Forbes is probably very familiar with the studio, which is in the heart of Limerick city and what it brings to the city for the people of Limerick is enormous. I could go on about the costs, the budget there is relatively low, but I would like Ms Forbes to give an assurance that she will explore the opportunities with the owner of the building to ascertain what lease possibilities are available. I ask Ms Forbes to do that unconditionally. I passionately believe in what RTÉ does. It is hugely important in terms of the quality of programming across the spectrum, including with TG4 and every area. Equally, Limerick has a twin aspect in that there is a regional broadcaster and Lyric FM in the same building. It was a model of decentralisation at the time, signed off by President Michael D. Higgins in his capacity as Minister for Arts, Culture and the Gaeltacht. Will Ms Forbes give that commitment now to explore with the owner of the building what lease possibilities are available? It is acknowledged that the organisation probably does not need the floor area that is there at the moment. There are opportunities and would it not be fantastic, were Ms Forbes to find savings to retain the twin studios of the regional broadcaster and Lyric FM in the heart of Limerick city? I wrote to Ms Forbes on 15 November. I followed that up with an email but this is a specific request. I have made the inquiry, and the owner tells me that discussions on downsizing did not take place.
Ms Dee Forbes:
Absolutely. Within our discussions with staff members, who are our priority, we want to ensure the dialogue is robust and is ongoing. Then we have to look at everything alongside that. We have to look at everything in the round for Lyric FM and Limerick, and there is no doubting our commitment to Limerick. We have said that whatever happens, we will maintain a presence in Limerick. It is very important from a regional perspective and from a news perspective, so that is a given.
In the limited time I have, the specific question I want to ask is whether discussions have taken place with the owner onlooking at various lease options involving downsizing. If not, will RTÉ engage in those discussions now?
I apologise for not being here earlier but I had questions in the Dáil Chamber. It is unthinkable that the public service broadcaster would not continue to exist and flourish because it always has played and always should play an absolutely key role in Irish society and cultural life and in its role in journalism. As I do not know how many of these questions Deputy Bríd Smith has put to the witnesses, I apologise if I am repeating anything she said. Ms Forbes does not help her cause if she defends things that are indefensible in the minds of many people who might otherwise support her. Ms Forbes does not help her cause if she sees the solution to the financial crisis of RTÉ as being essentially to dip into the pockets of ordinary people or saving RTÉ at the expense of its employees and the quality and extent of its services. Ms Forbes will actually damage her own cause in trying to defend RTÉ and the public service broadcasting.
The point has been well made but I just want to emphasise the cultural importance of Lyric FM. It is a unique guardian of music culture, including original music, new music, classical music and international music. It brings music that is not heard by a mass audience to a mass audience, that is, music that might not otherwise be heard by a mass audience. It would be incredibly retrograde to even consider winding it down, reducing it or getting rid of it altogether, not to mention the human cost for people who relocated to Limerick and so on.
Ms Forbes knows the things that are unpopular with people. This is not in any way to get at individuals but whatever justification there might have been for people getting paid hundreds of thousands of euro, when there was a genuine possibility some of them might go to England or somewhere else, is gone now. As that is not going to happen in the age of Google, Amazon and Netflix, it would help Ms Forbes's cause with the public if she talked about a cap on salaries. It is just not conscionable that people would be paid salaries higher than the Taoiseach for broadcasting. It is just not defensible. People went to jail over the licence fee because they could not afford to pay it. In the case of a lot of people who do not pay, it is because they cannot pay. Ms Forbes would be better off focusing on how there was a cut in the amount RTÉ got from the Department of Employment Affairs and Social Protection, which was capped and on getting that money back, as well as on measures like retransmission fees, digital taxes and so on.
The last point I want to make is that the biggest card RTÉ should play is in the area of original, culturally important output. Arts and culture in this country are massively underfunded. It is 0.1% of GDP, as against an average of 0.6% in Europe, and we should point to that. We should address the salaries and bring them down. We should of course be efficient but in fact, we should be expanding original, dramatic output and stuff that is relevant to the culture. We should be making the argument for that.
Ms Dee Forbes:
I thank the Deputy for his comments. I will take away his observations and I could not agree more with the Deputy on the Irish output, the Irish impact and Irish culture and arts. It is something on which we place huge importance within RTÉ and on which we want to place even more importance. It is one of the areas where our output has actually increased because of the way we restructured ourselves as an organisation.
Now, there is a thread of arts and cultural output going through all areas of RTÉ, from radio to TV to digital on a regular basis. I hope that there will be some element in the commission that was announced this morning, for example, on the future of public service broadcasting, to address Irish content for Irish audiences but also the importance of that and the Irish voice. Unless we have our own voice accentuated in this world, we will be talked at and talked for. I agree with what has been said in that regard. I would welcome any further development on it, as that is something we want to do more of.
Mr. Rory Coveney:
The AVMS directive was referred to. It is to be transposed by the end of the year. Within that, in a move that had considerable foresight, it offers member states the opportunity to create significant national content funds by levying those who benefit most from the digital economy. There is a number of examples of that in Germany, France and across the Union, but a mechanism has not been devised here yet. It is available to the Oireachtas to come up with a proposal. We are talking about companies that generate enormous sums of money in this market and that invest very little, if any, in the original programming. Retransmission fees are one part of it, but the AVMS directive allows for a levy to be created, which could be transformative for key genres like TV drama, which is going through an explosion globally in terms of the demand for it. A matter of significant regret for us is our reduction in spend on children's programming, in particular children's animation, which has a considerable export potential. It should be an important diet for Irish children to see Irish animation with Irish voices and Irish language voices as well.