Simon Coveney (Cork South Central, Fine Gael)

I move amendment No. 80:

In page 95, between lines 8 and 9, to insert the following:

"(e) ensure that the corporation acts responsibly in commercial dealings and in a manner that recognises the competitive market for broadcasting activities in Ireland and does not abuse any position of market dominance,

(f) ensure that any contract between the corporation and an individual or company for which consideration in excess of €400,000 per annum is to be paid to such individual or company, shall be approved by the Minister, with the consent of the Minister of Finance, in advance of their execution,

(g) ensure that a contract between the corporation and an individual or company for which consideration in excess of €400,000 per annum shall not be agreed for a period in excess of 12 months.".

I must admit that I cannot see a connection between amendment No. 80 and amendments Nos. 89, 104 and 106 and I do not understand why they have been grouped. However, I will outline the position with regard to the two amendments in my name.

Amendment No. 80 relates to the duties of board members and suggests that we should add three such duties to the existing list of four. The first of these new duties would be to "ensure that the corporation [RTE] acts responsibly in commercial dealings and in a manner that recognises the competitive market for broadcasting activities in Ireland and does not abuse any position of market dominance". On Committee Stage we discussed at length the unique position RTE occupies in many ways. For example, it is dual-funded - partly by means of the licence fee and partly through commercial revenue - but it also occupies a position of market dominance and there are responsibilities that arise in respect of this in the Irish marketplace.

It would make sense to stipulate that the board of RTE should ensure that everything it does takes account of the fact that the station occupies a position of market dominance. It must be acknowledged that there is a competitive market in which other broadcasters are trying to survive and also to compete with RTE. I accept that, at times, RTE struggles in this marketplace. RTE's position of dominance, particularly from the point of view of television, must be taken into account.

The other two duties I wish to impose are somewhat more controversial. Staff at RTE yesterday voted to take a pay cut. These are people whose salaries are paid directly by the station. The very high earners in RTE are not on salaries but are, in most cases, paid through media companies. The amendment suggests, therefore, that the board should change the way RTE does its business in the context of how it pays its top earners. In that context, it is proposed that these individuals should be paid on an annual basis rather than being given contracts which last four or five years and which cannot be altered, particularly when, as happened in the past 12 months, the marketplace changed dramatically and advertising revenues dropped by 30% or 40%.

The amendment also proposes that if an individual or a company representing that individual is to be paid to the tune of over €400,000 per year, a system of checks and balances must be introduced. This is because it will be public money which, in part, will be used to pay salaries of this nature. The State, either through the Minister or the new authority, should have some role to play in sanctioning the payment of such salaries.

Ordinary staff at RTE have agreed to take significant pay cuts. However, we have been obliged to rely on the higher earners at the station to, on a voluntary basis, take pay cuts. The latter is due to the fact that, from a legal point of view, RTE is completely snookered in the context of what it can do. It is farcical that public money is being either spent or committed in this way over the period of four or five-year contracts.

I do not buy into the simplistic argument to the effect that the high earners at RTE are so talented that they could simply leave the station and command the same salaries elsewhere. That may be the case for a small number of these people but it is not the case for all of them. If there is pain to be dished out within a large organisation such as RTE, then the high earners should be prepared to take their share of it. There should be no need for the public to exert pressure on certain individuals in order to encourage them to take voluntary pay cuts. Where such pressure is exerted, competition tends to develop among the higher earners with regard to which of them is prepared to make the greatest sacrifice. That is not right because these are highly talented people who deserve to be paid very well because they are at the top of their game.

I have no difficulty with RTE paying its top talent well. However, I do have a difficulty with the station committing to four or five-year contracts that cannot be changed when its funding structures change and when everyone else it employs suffers as a result. In such circumstances, there is no way RTE can make savings in the context of the payments being made to its high earners. Amendment No. 80 represents an attempt to try to deal with this matter and I am interested in hearing the Minister's comments in respect of it. I will comment later on amendment No. 89.

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