I move "That the Bill be now read a Second Time."
This is an unusually simple, single-provision Bill, the sole purpose of which is to provide statutory authority for the payment to Radio Telefís Éireann of grants in respect of net receipts from broadcasting licence fees during the two years ending 31st March 1972. Section 2 of the Broadcasting Authority (Amendment) Act, 1966 authorised the payment of such grants for the period ended 31st March 1970, and the present Bill provides for a two-year extension of these financial arrangements.
Apart from a special subsidy provision for the initial five years, the arrangements in question have existed since the establishment of the Authority. They provide for payment to Radio Telefís Éireann of the full net revenue from broadcasting licence fees, i.e. gross receipts collected by the Post Office and paid into the Exchequer less the costs of collection and any costs incurred by the Post Office in dealing with the prevention of interference in relation to the reception of broadcasting programmes. The payments to Radio Telefís Éireann are made in the form of Grants-in-Aid voted by this House under a subhead of the Vote for my Department.
In proposing in this Bill to provide for continuance of the financial arrangement for two years instead of five years as in previous Acts I have a number of factors in mind. Changes of an administrative nature in the Broadcasting Acts are under consideration and I hope to introduce a further Bill during the year to deal with some of them. My main reason, however, is that I wish to give consideration to the question of making a general review of the position of sound broadcasting and television. It is now eleven years since the Broadcasting Authority Act of 1960 established an independent Authority to control these activities. At that time Irish television lay in the future and there was no adequate experience by which to judge how sound broadcasting would fare under independent control and with the competition of television. All I would care to say at this stage is that I think the services have been developed successfully and have given general satisfaction to users, while, as was inevitable, encountering a healthy measure of criticism.
Despite the success of the Authority's activities there is much to be said for a periodic review at intervals of 10 years of thereabouts. Whether such a review is desirable at this stage and if so what form it should take are questions on which I have not reached a conclusion in the short period since my appointment to my present office. But looking to developments already under way, such as the provision of Gaeltacht radio stations, the advent of communal aerials for groups of 500 houses, and the prospect in the more distant future of coloured television, to mention but a few, I consider it would be imprudent to ask the Government or the House to commit themselves at this stage to continuance of the existing financial arrangements for so long ahead as five years. I hope to be in a position within a comparatively short period to reach a conclusion on the question of a review and with the approval of the Government to take whatever action is decided upon as most appropriate.
A Supplementary Estimate for my Department, including provision for an increased grant-in-aid to Radio Telefís Éireann, is due to be taken very shortly. As the Estimate debate is usually considered an appropriate occasion for discussion of the affairs of the Authority and general questions affecting the television and radio services, I suggest in the interest of economising the time of the House by avoiding a debate in duplicate that Deputies may care to hold over their general comments until the Supplementary Estimate comes before them in the next few weeks. But this is, of course, for Deputies themselves to decide and I shall endeavour to answer any questions raised. In the hope that the course I have suggested will commend itself to Deputies I propose to confine my remarks on the Bill mainly to financial matters. Before starting on these remarks, however, let me assure Deputies in whose minds the "Seven Days" Tribunal may be uppermost that the Supplementary Estimate which they will be dealing with shortly will contain an additional sum for expenses arising out of the tribunal so they will then have the opportunity of discussing this subject if they wish to do so.
Turning now to financial matters with which the Bill is solely concerned, Deputies will have seen in the annual reports and statements of accounts of the Authority which have been laid before the House each year that during most of the five-year period covered by the 1966 Act, the buoyancy of licence and advertising revenue enabled the Authority to show an overall surplus of revenue over expenditure, despite sharp increases in costs, an unchanged licence fee and a substantial loss each year on the radio service. Towards the end of the period, however, there was a general levelling-off in growth of licences, and in the fifth year the surplus was converted to a small deficit.
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The actual figures were as follows:— |
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|
1965-66: |
surplus |
£273,119 |
|
1966-67: |
,, |
£104,862 |
|
1967-68: |
,, |
£370,824 |
|
1968-69: |
,, |
£144,312 |
|
1969-70: |
deficit |
£21,383 |
The last mentioned deficit was caused by the loss of £676,029 on the sound broadcasting service, which was not fully compensated by a surplus of £654,646 on the television service.
The surpluses earned in the first four years mentioned above together with drawings from depreciation provisions were ploughed back into the development and expansion of the services, and capital assets were increased from £3,116,334 at the beginning of 1965-66 to £4,796,950 at the end of 1969-70.
In fact despite the capital expenditure incurred and capital assets created the Authority has not yet drawn any part of the extra sum of £1 million authorised in the Act of 1964 for capital purposes. At present its total indebtedness to the State amounts to £2,100,000 made up of £249,000 in respect of property et cetera transferred to the Authority at the outset, under section 32 of the Principal Act and £1,851,000 in respect of repayable Exchequer advances.
When the 1966 Bill was under discussion in February, 1966 it was thought possible that the whole additional £1,000,000 might prove inadequate for the capital requirements of the following few years and that an increase in the existing limit of £3 million in repayable Exchequer advances might prove necessary. Happily this need did not arise. But the Authority's capital needs continue to be heavy and are estimated at not less than £2 million in the near future, including heavy expenditure on completion and equipment of the sound broadcasting building at Donnybrook, renewal of the Athlone transmitter, efforts to improve reception of television programmes in certain areas et cetera.
The Authority is obliged by section 24 of the Principal Act so to conduct its affairs as to secure that at the earliest possible date its revenue becomes sufficient not merely to meet current expenses but also to make suitable provision with respect to capital expenditure. In view of the heavy continuing capital needs it would be unrealistic to expect the Authority to commence repaying its indebtedness to the State in the period to which this Bill relates. The Authority is, of course, paying interest on the advances from the Exchequer.
From July, 1970, increases of £1 in the combined licence fee and 5s in the sound broadcasting fee were approved. The amount of the Grant-in-Aid shown under Subhead L in the printed volume of Estimates in respect of licence revenue for 1970-71, namely £2,135,000, does not include the extra revenue in respect of these fee increases. A supplementary Estimate is necessary to enable this amount, estimated at £400,000 to be paid to the Authority.
It is as yet too early to say what the out-turn in the current year 1970-71 will be, but it is clear that the Authority's recent financial difficulties will continue for some time ahead. The elimination from 1st April next of cigarette advertising on television, which in the last full year before phasing out began yielded £300,000, will be costly to the Authority.
Advertising receipts constitute the main source of revenue available to the Authority, accounting in the last financial year for over 60 per cent of total income. Many people, and the Authority itself, consider this dependence on advertising excessive and disproportionate and, of course, many find the commercial interruption of programmes so irritating that they would like to see advertising dropped altogether. The hard fact, however, is that advertising content, at present limited to 10 per cent of broadcasting time, could be reduced only by increasing the licence fee, and to cease advertising altogether would involve increasing the combined licence fee from its present level of £6 to approximately £14.
It is perfectly clear that the Authority requires the payment of the net amount of revenue derived from sound and television licences and, indeed, further special efforts will be made to eliminate evasion of payment of licence fees so as to maximise revenue from this source.
I confidently recommend this Bill to the House.
