Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

Question 91: To ask the Minister for Communications, Energy and Natural Resources the budget set for 2010 to fund the Broadcasting Authority of Ireland; the budget for the period of its establishment in 2009; the cost to the authority of outsourcing work in 2010, 2011 and 2012; the way he will address the lack of public scrutiny in view of the scrutiny measures in the Broadcasting Act 2009; and if he will make a statement on the matter. [3896/10]

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The Broadcasting Authority of Ireland, BAI, was established on 1 October 2009 under the Broadcasting Act 2009 as the new statutory body to regulate the broadcasting industry in Ireland. The budget set by the authority's predecessor, the Broadcasting Commission of Ireland, BCI, for 2009 amounted to €6.238 million. That budget was prepared on the basis of a full year's operation although it was expected that the BAI would be established at some stage during that year. The BCI was allocated €4.575 million in Exchequer funding in respect of January to 30 September 2009. Following its establishment on 1 October, the BAI continued to operate until 31 December within the limit of the original budget set by the BCI for 2009.

As the BAI had not yet established the industry levy through which it is to be funded and as it had not yet established borrowing facilities which are provided for under the legislation, it relied on a number of existing cash flow sources to ensure that the regulation of the broadcasting industry could be maintained during the last quarter of 2009. As regards 2010 and later years, in accordance with section 37 of the Act, the setting of the budget for the BAI for any particular year is a matter for the authority. While the legislation makes provision in section 37(1) for the Minister to be able to specify the form the estimates should take and any additional information as may be needed, it does not require the estimates to be submitted for specific ministerial approval. The budget for 2010 has been set by the BAI at €7.6 million, which will be fully funded by the industry levy as provided for in the Act. Details of this budget have been submitted to my Department and I will be considering if additional information is required.

In accordance with section 37(7) of the Act, this 2010 estimate of income and expenditure will be published shortly by the BAI on its website, with my consent and that of the Minister for Finance. The BAI has indicated that the increase in the budget for 2010 over that the 2009 budget for the BCI is as a result of the increased role given by the Oireachtas to the BAI. While the BAI has taken over the functions of the BCI and the Broadcasting Complaints Commission, BCC, it has also been given a range of new functions additional to those held by its predecessors, mainly relating to public service broadcasting and the provision of digital broadcasting services. The BAI has also indicated that the extent to which this budget is actually expended will depend on the level of activity of the organisation. It has confirmed that it will discharge its functions in a cost effective manner and is conscious of not imposing an undue burden on the broadcasting sector. Additional information not given on the floor of the House.

In this context, section 32(4) of the Broadcasting Act requires the authority to ensure that regulation by the authority and the statutory committees does not involve the imposition or maintenance of unnecessary administrative burdens. In addition to including this provision in legislation, I have made clear to the authority the need to be particularly vigilant about keeping costs down in the current economic climate. I understand that the authority has requested the chief executive to continuously review its proposed expenditure throughout 2010 with the aim of reducing it where possible. In accordance with section 33 of the Act, any surplus of levy income over expenditure in 2010 shall be offset against future levies or refunded, as appropriate.

Section 33 of the Act provides for the BAI to meet its expenses by means of a levy on public services broadcasters and broadcasting contractors. The Act requires the BAI to make a levy order for the collection, payment and administration of a levy and for a levy order to be laid before each House of the Oireachtas as soon as may be after it is made. The levy order for 2010 was laid before both Houses on 19 January 2010.

With regard to the outsourcing of work, section 18 of the Broadcasting Act 2009 provides that the authority may engage consultants or advisers as necessary in the performance of its functions. The outsourcing of work is, therefore, an issue for the authority in accordance with the requirements of the Act.

I do not accept that there is a lack of public scrutiny of the BAI. The Broadcasting Act provides a range of measures to ensure appropriate public scrutiny. Section 37(4) of the Act requires that the annual accounts for a particular year are to be submitted to the Comptroller and Auditor General not later than the end of March the following year and, in accordance with section 37(5) of the Act, are to be submitted to the Minister, along with the report of the Comptroller and Auditor General, for laying before the Houses of the Oireachtas by the end of June of that year. Furthermore, the chief executive is accountable to the Committee of Public Accounts, and the chief executive and the chairpersons of the authority and its committees are accountable to the appropriate committees of the House of the Oireachtas.

In addition to the requirements on the provision of estimates of income and expenditure, there are also provisions requiring proper management of books and records relating to income and expenditure and for ministerial oversight and consent as to the form of accounts. The BAI is also subject to the Department of Finance guidelines on corporate governance of State bodies which include a range of obligations in terms of reporting, accountability, risk management, internal audit and departmental oversight.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

I hope the Minister gives me the information on the additional cost of outsourcing work by the Broadcasting Authority. This is a central issue. Does the Minister not accept that it is absolutely outrageous for him to tell us now that the budget for 2010 will be €7.6 million, even though throughout the debate on the legislation he tried to dampen our concerns about increased costs? In the past the Exchequer has footed the bill for broadcasting regulation but now that the broadcasters must foot the bill the costs have gone out of control. The figure for last year was €6.2 million, but the figure for this year is €7.6 million. It is a new authority but it is very similar to the old one in many ways in terms of regulating broadcasting. How can the Minister stand over such escalating costs?

Will he also answer the question about the additional costs? Staff have left during the transfer and work will have to be, and perhaps already is, outsourced. How much will that add to the costs? How much is included for it in the €7.6 million? What will the Minister ensure is published that is in line with the legislation passed by the House, in which the Minister agreed to ensure proper scrutiny of what the authority does, by everybody and particularly by broadcasters who have suffered a 25% to 30% reduction in their advertising revenue?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

I agree with the Deputy that every organisation must be conscious of costs in these difficult times and keep budgets tight-----

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

They have exploded.

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

-----and live within them. The chairman and chief executive of the Broadcasting Authority of Ireland are aware of that fact. They are committed to examining every aspect of their business, ensuring that they pare the costs down to the bare minimum and that the final outcome in terms of expenditure could be below what has been estimated. They will publish an initial estimate but they are committed to maintaining costs to the minimum at a difficult time, particularly for many broadcasters as advertising revenues fall. The authority has additional functions. It must undertake a body of work this year in particular, as it sets itself up and takes on a range of new roles. That will involve certain outside consultants. There will not be the major increase of staff which was originally sought to take on this work. I believe the work can be done cost effectively. The authority's work benefits the industry in the short, medium and long term in providing a fair and competitive environment in which all operators know they are dealt with effectively and well. That, as well as being cost competitive, is a key requirement of the authority.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

The Minister is still in denial; he has been in denial from the beginning of the debate on this issue. The Minister knows that the way to organise efficiencies is to have one regulator to replace ComReg and the Broadcasting Authority. We now have a broadcasting authority with a budget of €7.6 million. That is the reality. Nothing else matters and nothing the Minister says in honeyed words about every effort being made changes that. The budget is a burden borne by broadcasters who are currently in difficulty. That is the Minister's responsibility.

There was a hidden cost in the last three months of last year. How much is that cost and who will pay it? The Exchequer stopped paying as soon as the new authority was established on 1 October. Who has paid the bills since then? How will they be met if they are based on borrowing?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The budget for last year was €6.238 million for the full year. The BAI was only in operation for the last quarter. The budget from April to September, therefore, was set at approximately €4.550 million and the remaining budget of approximately €1.5 million - the accounts have still to come in - was the estimated cost for that fourth quarter. It was largely met from cash flow resources that the authority had at its disposal. The approach that was always agreed on this-----

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

I do not know what that means. The Minister must explain it because it does not make any sense. Money comes in from the Exchequer. The budget was €6.238 million. There is now a €1.5 million shortfall and the Exchequer is not paying for it. The BAI is in existence and has costs. It is only a new body so how can it have cash flow?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

It was legislated that the new body would not be paid by direct Exchequer payment, and provision was made for that in the accounts for last year.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

Who is paying for it then?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The interim payment was made through existing cash flow resources the authority had. The levy was always due to be applied. It will be paid quarterly, with the payment being applied to the previous quarter. The first payment in the first quarter this year, therefore, is retrospective.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

It is for last year. I see.

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

That will apply for each quarter. There is also the provision that where there is an underspend, that amount can be refunded to the industry to ensure it gets the benefit from savings that should, and I am sure will, accrue.

Liz McManus (Wicklow, Labour)
Link to this: Individually | In context

The final figure, therefore, is €7.6 million plus €1.5 million.

Brendan Howlin (Wexford, Labour)
Link to this: Individually | In context

We must move on to Question No. 92.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context

Question 92: To ask the Minister for Communications, Energy and Natural Resources the position regarding the progress made in securing commercial digital television services following ongoing negotiations between a consortium (details supplied), RTE and the Broadcasting Commission of Ireland; and if he will make a statement on the matter. [3893/10]

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The Broadcasting Act, 2009 requires the Broadcasting Authority of Ireland, BAI, an independent regulatory authority, to provide for the development of commercial digital terrestrial television services.

On foot of this requirement, the BAI's predecessor, the BCI, launched a competition, which is still ongoing. As the Deputy is aware, the highest placed consortium in the competition withdrew from the process last April. Negotiations then commenced with the next placed bidder and this process is continuing.

As I stated recently in response to a previous question on this issue, I am not prepared to speculate on the outcome of the commercial DTT process, which is a matter for the BAI and one in which I do not have a direct role. Nor am I prepared to surmise on the ongoing negotiations between BAI, RTE and the OneVision consortium. I have, however, made clear my views that I would like to see this process concluded as soon as possible.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context

The Minister has been saying that for six months.

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The conclusion of the process is essential to provide certainty for broadcasters, suppliers and the general public with regard to the development of commercial DTT services in Ireland. More generally, it is my intention that analogue TV services will be switched off in late 2012. This will ensure a valuable digital dividend and it underlines the need to implement a DTT service.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context

This is the third or fourth time we have discussed this issue. The Minister, Deputy Ryan, will know that I and many others have real concern that we will not be able to make the 2012 deadline for analogue switch off, which will have significant consequences. I understand - the Minister can correct me if I am wrong - that the new BAI met to discuss the DTT issue yesterday. There are ongoing negotiations between RTE and the OneVision consortium, which is now the proposed provider of commercial DTT services on the multiplexes which are there for that.

I asked the Minister, Deputy Ryan, a question several months ago and wish to ask it again. Will he set a deadline for those negotiations to be finalised so we all know the status of DTT regarding RTE, which has responsibility for and is required to provide free-to-air DTT services which, I understand, will be called Saorview? There are significant financial consequences for RTE because of the commitments which have to be made to put the infrastructure in place. Should OneVision go the route of Boxer we will be left holding the baby. The Minister will be responsible even though he seems to refuse to be part of the process at this stage.

As the person responsible from a policy perspective, will the Minister set a deadline for RTE and OneVision to conclude their negotiations so we and the Minister, who is the policy maker in this area, know where the country stands, in terms of the provision of commercial DTT which is a requirement for the provision of a viable free-to-air DTT service?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

I have already set deadlines. There is a deadline within the legislation we recently enacted for the switch on of a free-to-air digital service in December 2011. There is a deadline for us of 2012, which is when we will switch off our analogue system because the valuable spectrum we can then accrue for broadband and other purposes is of real importance to us. That is a certain deadline-----

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context

We are not on course for that.

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

-----and I said to each of the parties directly and clearly that, come what may, that deadline will be met. We will switch off our analogue services. In terms of the ongoing commercial negotiations between OneVision and RTE, it is the Broadcasting Authority of Ireland which will ultimately set the deadlines on that process. That, under the legislation, is what its authority is and it would be wrong for a Minister to step into the middle of a commercial negotiation process and start subverting the BAI's role in that regard. I have given clear indications here and elsewhere to everyone involved that there is time urgency with this issue and that it is in everyone's interest, if we are in such negotiations, to conclude them quickly. I will not step into the middle of commercial negotiations because that would be counterproductive and improper.

Simon Coveney (Cork South Central, Fine Gael)
Link to this: Individually | In context

I am not asking the Minister to step into the middle of the negotiations. Will he accept that RTE has already spent some €70 million putting DTT infrastructure in place, on the basis of having a commercial operator in place which would help to finance that infrastructure? Would he also accept that he changed the broadcasting legislation, through an amendment, to change the deadline which was set for the provision of DTT services, the deadline for which was the end of last year because of the ongoing problems resulting from Boxer pulling out?

This time last year Boxer pulled out and we now potentially have a crisis on our hands, should it turn out that RTE and OneVision cannot do the necessary deal. If that should happen we are starting all over again. The Minister has responsibility to ensure that we are on course and that there is a clear road map in place to deliver analogue switch off by the end of 2012. Yet, all the Minister is willing to say at the moment is that at the end of 2012 analogue switch off will happen. Is he now saying that he will put no deadline in place for the conclusion of negotiations between RTE and OneVision?

Eamon Ryan (Dublin South, Green Party)
Link to this: Individually | In context

The 2012 deadline is real and absolute. It also gives any party involved a clear deadline to be able to effectively set up whatever alternative service comes out of this process. We are clearly coming very close to the time lines where we have to act immediately. A deadline is set for 2012 which would require all parties involved to make their minds up and make their commercial decisions quickly. Come what may, that deadline will be met. We will switch off our analogue services and, despite the difficulties and the slowness of the process, I am still confident we will have an alternative digital service to offer the Irish public.