Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

First, I take this opportunity to thank the Chair, the Vice-Chair and the members of the Joint Oireachtas Committee on Communications, Climate Action and Environment for the excellent work they carried out on the review of public service broadcasting, both in preparing the report on the future funding of public service broadcasting, published in November, and more recently the pre-legislative scrutiny report on the Broadcasting (Amendment) Bill 2017.

I fully recognise the important part that public service broadcasters play in our democratic society. The provision of stable and adequate funding is essential to ensuring their survival. The role of a strong and credible national broadcaster is more important than ever in a world of misinformation and fake news. The problems posed by fake news will only be combatted by strengthening traditional media and by quality journalism.

Journalism goes to the heart of who and what we are as Irish people and how we interrogate ourselves as a society. The Reuters Institute Digital News Report 2017 survey shows that 66% of respondents used RTÉ as their main source of news, which is significantly higher than the international average of 49%, while trust in RTÉ as a news brand stands at 57%. With an increasing number of channels available from the UK and elsewhere, and the advent of international content providers like Netflix and Amazon, it is more important now than ever that we invest in Irish content. We need strong public service broadcasters that have the resources to produce and broadcast material that says something about who we are as a people and which helps sustain a distinctive national identity. Strong public service broadcasters are important not just for their own sake but because they support a vibrant independent production sector in Ireland.

In any given year, the majority of Irish television programming is made or commissioned by RTÉ. This ensures Irish audiences have access to high-quality Irish programming. It is also vital to sustain and grow Irish talent on-screen and in the independent production sector.

I must also mention the importance of TG4 to Irish audiences. The national Irish language public service broadcaster is responsible for bringing Irish language content to audiences in Ireland and around the globe. While the majority of TG4's funding comes from the Exchequer, it is reliant on €4.2 million in funding from the television licence. It is also a crucial element in regional television production and has played a key role in supporting the sector outside Dublin.

RTÉ and TG4 support thousands of jobs across the Irish economy. Both public service broadcasters spend millions of euro each year on independently produced programming, which is having a significant impact on local and rural economies. In financial terms, however, public service broadcasting is in deep trouble. Falls in commercial income and advertising revenue and television licence fee evasion have all had a negative impact. Both RTÉ and TG4 have prepared five-year strategies for the period to 2018 to 2022. These are being currently considered by the Broadcasting Authority of Ireland, BAI, as part of its five-year review of public funding. I expect its view on these documents shortly. However, in order for RTÉ and TG4 to plan for the future, carry out the objectives required of them and remain relevant in an increasingly changing digital world, significant additional resources will be required in the years ahead.

As Members are aware, RTÉ is funded through a mix of licence fee revenue and commercial revenue. In 2008, the total income was €440 million while today that stands at €340 million. RTÉ returned an operating deficit of €2.9 million in 2015 and a €19.7 million deficit in 2016. There were further operating losses in 2017. Deficits are inevitable in the coming years. This cannot be allowed to continue. The television licence fee system faces a number of challenges, with the current unacceptable levels of evasion being the most obvious. While the rate has fallen from 15.3% at the end of 2013 to the current rate of 14.6%, it is still very high. The high level of evasion represents an annual loss of approximately €40 million to public service broadcasting. Effectively, everyone who pays for the television licence pays €39 to cover the cost for those who will not pay. This affects both the public service broadcasters and the independent sector. Reducing the evasion rate would provide a mechanism to support a vibrant broadcasting sector without imposing additional charges on the public. Ultimately, the public is the loser here as the lack of funding means it is not getting access to the quality Irish content it is entitled to, especially those who pay the television licence fee.

In October 2016, I requested that the committee examine the longer-term issue of the future funding of public service media. I commend the committee on the thorough and extensive public consultation and stakeholder engagement that fed into its work. The recommendations in the report are wide ranging. Some of them can be implemented in the shorter term. Others will require a longer timeframe. I fully agree with the committee's recommendation that the current system of providing free television licences to those in receipt of the household benefits package should continue. In addition, the committee recommends removing the Department of Employment Affairs and Social Protection funding cap that was introduced in 2011. This action froze payments for free television licences at the 2010 level, and a further €5 million reduction was introduced in budget 2014. While there has been some restoration in this funding, there is merit in exploring this recommendation. I intend to discuss this issue with my Cabinet colleagues during the Estimates process.

The committee also makes recommendations on sharing licence fee moneys across a wider range of broadcasters in the independent, local and community sectors.

However, it has been recognised by the committee that before this can be achieved, additional resources are required and the current evasion rates in respect of the television licence fee must be addressed. I concur with this view.

There has been no increase to the licence fee since 2008 and the committee recommends this should be reviewed in the coming years. However, I believe the priority should be reforming the current collection model. Otherwise, the same people will end up paying more while others contribute nothing to the cost of public service broadcasting. As I mentioned above, while the evasion rate has reduced to 14.6%, it is still very high. Sales figures have improved gradually since their lowest point in 2012 and, in fact, provisional figures for 2017 show that TV licence sales last year were at their highest since 2010. This improvement has been achieved through a number of alterations to the current system. While the improvement is very welcome, we need a far more significant shift in the evasion rate if we are properly to fund public service broadcasters as well as to broaden the pool of contributors.

As the House will be aware, I have obtained Government approval to draft a number of legislative amendments to the Broadcasting Act 2009, including amendments on the tendering of TV licence fee collection services. Once these legislative amendments have been enacted, it will be possible to hold a public procurement competition to tender for a new collection agent, if required. In addition, I have made a number of proposals which will assist the broadcasting sector once implemented. For example, I have proposed the introduction of a new funding scheme to offer bursaries to journalists working in local or community radio stations. I have also proposed a reduction in the broadcasting levy to alleviate the burden on broadcasters. This proposal will reduce the overall levy to be paid by the sector and will be applied evenly across all broadcasters.

Since my appointment as Minister, I have spoken to many individuals in commercial and community radio stations and I understand the financial pressures they face. By reducing the amount of levy they are required to pay, we should manage to ease some of the difficulties they face. It is my intention that community radio stations will be exempt from this levy altogether. Recently, I announced my intention to seek Cabinet approval to further amend the Broadcasting Act 2009 to remove the only limit on advertising for commercial radio stations. In conjunction with this, and to ensure fairness across the market, I will also give RTÉ greater flexibility in respect of its own limits on radio advertising.

The committee issued its pre-legislative scrutiny report on these proposals on 8 March and my officials are currently examining the contents. The report is also being considered by parliamentary counsel in the drafting process. In relation to retransmission fees, I note the committee agrees in principle to their introduction but has proposed that further analysis is required to examine all financial and economic implications for stakeholders. I agree with this course of action. I am extremely grateful to the committee and appreciate the work it has carried out at my request. It is very useful for committees to look at long-term issues and challenges across the economy, not just within our own Department area. While I have been criticised by some for referring this matter to the committee, it was the right thing to do. We now have a very detailed report which gives me a body of work on which to base my proposals. The level of consultation and engagement which has taken place has been very useful. As I indicated during last week's discussion on the Estimates, it is my intention to examine and explore carefully the recommendations made in the future funding report and to bring the matter to Government in the coming weeks.

See this speech in context