Dáil Éireann debate -
Tuesday, 7 Nov 1978

Vol. 309 No. 2

Private Members' Business. RTE Licence Fees: Motion.

Mr. O'Toole

I move:

That Dáil Éireann deplores the decision of the Government to authorise RTE to increase licence fees.

I move this motion as my party's spokesman on consumer affairs. Deputy O'Donnell and I had two reasons for putting down the motion and I shall outline them. First, because of the sheer size of the increases we considered that they necessitated a public debate. Secondly, we put down the motion because the National Prices Commission were ignored in this case.

The increases granted in this instance are very strange in the light of what was clearly stated in the Fianna Fáil manifesto of June, 1977. On page 7 of that manifesto in the section headed "Prices" it is stated in paragraph 2:

Government policy must be directed towards discouraging increased costs and prices in all areas where it has control or influence. This policy has been absent in the last four years.

That was a statement, a declaration of intent by Fianna Fáil at the time. Now that they are in government we expected that they would underpin that commitment through action. I shall quote again the words of the manifesto "...in all areas where it has control or influence". Surely this must be regarded as an area in which the Government have absolute control and influence but the massive increases have been given with what I would call a pathetic justification because the argument made for allowing them, in the form of comparative levels of fees elsewhere, is both weak and misleading, to put it mildly. We are not comparing like with like, a matter with which I shall deal later.

The increases involve a 24 per cent hike in the case of monochrome television sets, from £18.50 to £23 and in the case of colour television sets, an increase of 22 per cent, from £31 to £38. A minor point but one that should not be missed is that it is rather strange that the higher increase has been allowed in the case of monochrome television sets, a 24 per cent increase. Despite the massive increase in colour television sets there is still a large number of monochrome sets and it can be said without fear of contradiction that these sets are in the possession of the less well-off section of our community, people who cannot afford colour television sets. Yet, for some strange reason the larger increase is given in the case of this section. I do not know the reason but it is indicative of the philosophy that underlies the policies of the Government. On the one hand they have abolished wealth tax but on the other hand they are sending out smoke signals that the PAYE taxpayers will be mulcted in the next few months in the budget. Having regard to that kind of philosophy there is nothing new in the attitude of the Government.

We are the fourth dearest country in the EEC with regard to television licence fees. I shall revert now to what I said before concerning the statement that was issued accompanying the announcement of the increased licence fees. Comparisons were made and it was pointed out that Denmark had a licence fee of £64, Belgium £51 and Holland £47.50. The Minister must know that a statement of that kind tabulating licence fees in countries that are not comparable to ours makes no impression on the ordinary licence holder, on Members of this House, and I would hazard a guess that it makes little impression on some of the Minister's colleagues sitting behind him because we are talking of countries that have a cost of living and a standard of living far in excess of what we experience. No doubt the Minister, from both his travels as Minister and from his experience as a public representative, is well aware of that fact. We cannot compare our standards with those of Belgium, Denmark or Holland. Any attempt to make a comparison would be an effort to mislead the public into thinking that we are not doing too badly now that we are in fourth place.

In the UK the licence fee is £9 for black-and-white television and £21 for colour television. These figures represent little more than half the level of our licence fees. Also, in the UK set-up there is a total dependence on licence fees. There is not the facility of having a second source of income, namely, commercial advertising. The other major channel in the UK, ITV, have similar licence fees but as they do not derive anything by way of licensing sources they depend totally on advertising.

The reason for our interest in this matter to the extent of tabling a motion for public discussion is that a great number of people are involved. As was stated recently by an executive of RTE, we have reached saturation point so far as the possession of television sets is concerned. I am informed that the number of licences held is in the region of 700,000 but from what I have been hearing this figure would not seem to be an indication of the number of television sets in use. The degree to which the payment of licence fees is being evaded is a matter which caused concern to the Minister's predecessors and I am sure it causes the Minister concern, too. The problem is to find a way of ensuring that those people who are not paying licence fees are brought to justice and made to pay. It is very unfair that those lawabiding people who pay their licence fees should be asked to carry the can for those who, for reasons best known to themselves, find a way out of the legitimate demands made on them in this respect.

The other reason for seeking public discussion of this important matter is the amazing lack of information regarding the whole question of the case made by RTE. We all know that the provision of a television or a radio broadcasting service is an expensive operation both from the point of view of capital investment and of current running costs. In this type of media we are dealing in what is known as high technology and in an area of high performance which in turn means high fees being demanded by performers. Hopefully, the Minister will give us some indication as to the amount sought by RTE and the purpose for which it was sought. The Minister may correct me if he considers that necessary but my information is that there is a grey area in the case of the granting of a £7 increase specifically for RTE 2 and in order to provide an income of £2.3 million. In other words, there is specific reference to the area in which the increased revenue is to be spent whereas my information is that while there was a demand for an increase in the licence fees, the figure mentioned was in respect of a package of developments which RTE had in mind and one of which was RTE 2 and that other factors entered into the area of extra expenditure such as the expansion of both radio and television services, the provision of hardware in the form of the replacement of materials and also the purchasing of new technical material to improve the service.

I have been told that all that was expected towards the operation costs of RTE 2 was a £5 increase and that the RTE Authority were happily surprised when they found that a £7 increase had been granted for a specific purpose. Certainly, the reaction from RTE on the day following the announcement of the sanction of the increase would seem to indicate a certain degree of pleasant surprise in relation to the amount allowed when their spokesman said they were happy with the increase sanctioned.

I wish to deal now with another area that I mentioned at the outset, that is, the ignoring by the Government of the National Prices Commission. In this instance the very Government who set up the commission, and rightly so, to monitor on behalf of the public demands for price increases in respect of all commodities and services, decided to ignore that commission. It was something sought for a long time and the Government of the day in their wisdom decided to set up this body.

The activities of this body serve two purposes. First, they monitor and scrutinise in detail and, if they think necessary, seek consultants to advise them on demands made for price increases in various commodities. On the basis of the information available to them they then make recommendations and present them to the Minister, who in turn, accepts or rejects them as is his right. Second, and this is very important, the commission publish a monthly report outlining in detail the demands made for price increases. They give indepth information with regard to different commodities and they give the reasons why they make certain recommendations.

This report is available for the public to read and comment on and they can use it as a guideline to consider the price increases sanctioned by the Minister of the day. Because in this case the National Prices Commission were ignored there is a profound lack of knowledge so far as the public are concerned. I have no doubt that RTE made a very good case to the Minister backing their arguments by giving various figures of expenditure and so on. The fact is the Minister knows the case they made and on that basis may take recommendations, but we are not aware of the case made, except as synopsised through newspaper reports of the current demand on RTE, the provision of RTE 2, the expansion of the radio service and so on.

This body were set up by the Minister's own Government and have served the country well. Last week the Minister's colleague made the excuse in this House that the National Prices Commission did not have the capacity to comment on a demand of this nature because they were a new service and therefore would not be in a position to use comparative data to make recommendations. There are two arguments against that kind of statement. First, I question the validity of the statement that this is a new service. To me and to many other people, RTE 2 is an extension of the present service. It is an expansion of the old RTE. We now have RTE 1 which is a new animal and RTE 2 which is also a new animal. They both came into being together because we did not hear mention of RTE 1 until RTE 2 came on the scene. We had plain RTE. To me RTE have been split into two, into RTE 1 and RTE 2. We end up with an expansion, we are told, of some 60 per cent in television production time through RTE 2. The excuse that this is a new service is rather lame.

The second allegation, that the National Prices Commission were not capable of making informed comment on the demands made for the increase in the licence fees has much more serious significance so far as we are concerned. If that is so I would like to know with whom did the Minister consult in scrutinising the application made by RTE? If the NPC as a body—and I have absolute confidence in them in carrying out their functions within their terms of reference—are able and capable and have a capacity to look in depth at a multiplicity of applications made month after month, week after week and day after day, and make recommendations to the Minister, on what basis does he now feel that they are incapable of making any informed comment or recommendation on RTE's application? This shows a complete lack of confidence by the Minister.

I agree it was not the Minister who is at present sitting in the House but his colleague the Minister for Economic Planning and Development who made that statement. On the principle of collective responsibility, I assume that the Minister present would have to accept responsibility for what his colleague said. He definitely must accept responsibility in the light of an undertaking, a serious commitment, given by his Government before assuming office.

First, they said they would re-vamp the National Prices Commission to make them more effective in ensuring that applicants did not get more than they were entitled to or than they sought. The last sentence on page 7 of the Fianna Fáil manifesto said that frequently the application made was for far more than the firm really needed and that the increase granted was often far more than the firm ever expected. In this case the National Prices Commission were not responsible for giving far more than the firm expected. It was the Minister who saw fit to do so, without any consultation so far as we know. If consultations took place and if advice was sought, I should like to know from whom that advice was sought, by whom it was given and whether the Minister accepted the advice given to him. These are facts which would be stated plainly in the report of the National Prices Commission had the Minister resorted to that source of information and advice when this application was made last May.

At paragraph 5 on the same page of the Fianna Fáil manifesto it is stated:

Control by legislation, in the interest of the consumer, of monopolies in particular, and of take-overs and mergers were relevant.

No later than last week, the Minister put beyond yea or nay any illusion about offshoots of private companies entering into the area of broadcasting. RTE are to hold the control and therefore logically they will have a monopoly. This is the kind of philosophy emanating from the Minister. I will not go into the rights or wrongs of it at the moment because it does not concern the motion. The Minister must agree that, in their present form, and as he sees their function, RTE are a monopoly. In their manifesto the Fianna Fáil Party gave an assurance that they would pay particular attention to areas of monopoly. Surely this is an area where the Government have absolute control and influence, and where they are dealing with a monopoly.

The by-passing of the National Prices Commission has led to a great vacuum in informative comment and information to the public. In this House last week, it was thrown at us in Fine Gael that we did likewise in 1974, so far as I remember. In 1977, when an application was made for an increase in the licence fee, it was referred to the National Prices Commission. The increase sought was £3 for monochrome and £5 for colour. Having consulted with the National Prices Commission, the Government of the day approved an increase of £2.50 and £4 respectively. To me the by-passing of this important body undermines their importance and their standing. That is very serious. The lack of information arising from the way this matter was handled is nothing short of criminal in the sense that it is open to any interpretation.

We are dealing here with a public body. RTE are a State body. The funds they use come from three sources: repayable advances from the Exchequer, licence fees and advertising revenue. Because they are a public company, surely the principle of public accountability is involved. That accountability was lacking because of the way the application was handled. I heard this dictum quoted recently by an RTE executive: commercial broadcasting is a licence to print money. The strange thing is that that would seem to be true. The Minister is well aware that at this moment there is an ungodly rush to get into commercial broadcasting, not by people who are concerned with academics or culture or aesthetics. They are hardheaded businessmen investing money and seeking what they regard as a fair return for it. They are tripping over one another to get into commercial broadcasting. RTE have it all to themselves.

I should like to ask the Minister what is wrong when a monopoly of this kind cannot show what could be regarded as a return from the opportunity they have at their fingertips. In 1977 the RTE Authority showed a welcome surplus of £1.5 million. If that trend is to continue, surely we must expect that surplus to increase over the years. Surely we must also expect that if that is so, RTE's dependence on the licence holder to pay the piper would also diminish. In fact, that dependence seems to be increasing to an extent that it will possibly affect the consumer price index in the first quarter or the first half of 1979.

This rush by very shrewd hardheaded businessmen into commercial broadcasting leaves RTE with many questions to answer and, in the light of the increase sanctioned and granted by him, leaves the Minister with some questions to answer. The fact is that licence holders are being asked to pay for something for which many of them did not ask. No equality of service is being given as between the east and the west—for example, in the multi-channel versus the single channel or double channel areas. We are now talking about demanding a licence fee from people in some areas whose reception is so bad that they cannot get RTE 1 as my colleague tells me. Putting it in a nutshell, licence holders are being asked to pay the same fee but are not getting the same return.

Minister for Posts and Telegraphs (Mr. Faulkner)

I move the following amendment:

To delete all words after "Dáil Éireann" and substitute the following:—

"takes note of the decision of the Government to allow an increase in licence fees to provide for the second television service."

To say that I am surprised that the Fine Gael Party should put down a motion here deploring the recent increases in television licence fees is to put it very mildly particularly when one notes the dismal record of that party in respect of increases in television licence fees when in government from 1973 to 1977. I can only conclude that the rapidly improving economic scene since this Government took office leaves them little scope for real criticism and forces them to grab at any straw. I certainly find the attitude of the Opposition hard to reconcile with the performance of the Coalition when in government. It would appear to me that Deputy O'Toole found it difficult—and I do not blame him—to defend his motion. Quite obviously his heart was not in it. He began by expressing horror at the size of the increases. When one remembers that in 1976 the Coalition Government increased licence fees by £4 for mono television sets and £7 for colour television sets as against £4.50 for mono and £7 for colour in 1978, which is very much lower in real terms, I am amazed at the fact that he should express horror at the present increases.

It is worth while to look back at the history of licence fee increases since the introduction of RTE because it clearly shows that the actions of the Coalition when in Government differs dramatically from their stance in Opposition. Indeed, Deputy O'Toole in his speech, coupled with the wording of the Fine Gael motion, would appear to suggest that RTE should be able to provide a second national television service without the need for any increase in television licence fees. It might be helpful if we looked at the record. Television licence fees were first introduced in January 1962 on the inauguration of the television service here. The annual fee at that time was set at £4. Between January 1962 and 1 September 1971 there were three increases authorised. In almost ten years under a Fianna Fáil Government the fee had risen from £4 to £7.50 in respect of any kind of television set, black and white or colour. From September 1971 until the Change of Government in 1973 there was no further increase in the television licence fee. It is no harm to mention that the separate licence fee in respect of radio receivers was abolished during this period with effect from September 1972. We might contrast that situation with the performance of the Opposition when they were in office. Under the Coalition Government the television licence fees were increased on no less than four occasions, 1 October 1973, 1 October 1974, 1 February 1976 and 1 April 1977. That is to say, in four years the number of increases authorised was in excess of the number authorised in the previous 12 years under the Fianna Fáil Government. When the Coalition took office in 1973 the television licence fee was £7.50 in respect of either a mono or a colour set. When they left office four years later television licence fees had been increased to £18.50 for a mono set and £31 for a colour set, representing increases of 146 per cent in the level for mono television licences and 313 per cent in the level for colour television licences. We must remember that for these increases in licence fees the viewers did not get any additional services.

When the decision was taken in November 1975 that RTE should be entrusted with the running of the second television service it was obvious that this would involve significant increases in television licence fees when the second service was established. The need for the recently announced increases in television licence fees flows directly from the decisions which were made. It might be useful at this stage to recall the background to these decisions. In October 1973 the provision of a transmitter and microwave link network which would serve for either a second RTE channel or for rebroadcasting one Northern Ireland television channel was authorised. To date almost £4 million has been provided by way of Exchequer advance to finance the construction of this network. At that time a vigorous debate took place on the use to be made of the second transmitter network when completed and during this debate Fianna Fáil supported the people in the single channel areas in their claim to entitlement to a choice of television viewing. However, we did object to handing over what was in effect control of a national asset, that is our television broadcasting frequencies, to another country. We argued our case strenuously and at the end of the day the voice of the people was heard loudly and clearly and was reflected in the result of the survey which was conducted in October 1975 and which indicated in both single and multi-channel areas that there was a strong preference, about 62 per cent, for a second RTE channel.

Mr. O'Toole

We have now got BBC 1.

Mr. Faulkner

Following consideration of the survey, which showed a clear preference for a second RTE channel, it was decided in November 1975 that the second television network when completed would be used for this purpose. In arriving at this decision the best information available to the Coalition Government about its effect on the level of television licence fees was contained in the RTE booklet, The Second Channel, published by the RTE Authority the previous June. We must assume that RTE made the best case they could for holding that the second television network should be used for a second RTE service instead of for rebroadcasting BBC 1. Presumably they would also be anxious to show that their proposal would not involve a big increase in the television licence fee. Therefore we can assume that, having examined the whole question of the fees, they came up with the lowest fee that they felt was compatible with operating the new service. In section 7 of that document RTE set out what was, at the time, its best estimate at 1975 prices of the running costs of a second RTE channel. They estimated that from 1979 onwards some £3,914,000 would be needed over and above advertising income to pay for the second service and this would represent a general increase of £7.10 per licence. Let me emphasise again that this estimate was one based on 1975 prices.

The licence fees had already been increased twice since the Coalition Government took office and the mono licence was £12, while the colour licence was £20. There was no question about the fact that the previous Government knew perfectly well it would be absolutely necessary to have extra money made available for the provision of RTE 2. At the very time when they recognised that this extra money was necessary, a further significant increase in licence fees to finance the existing broadcasting service was also under consideration. It is amazing to look at the record of the party opposite, taking into account the motion before the House. The only concern expressed by the Coalition when in office in regard to the level of television licence fee increases necessary to finance RTE 2 was the announcement in December 1976 that it had been decided to postpone the introduction of even a limited second television service by the end of 1977, first, because of its implication for the public capital programme for 1977 and future years and also because of its effect on television licence fee levels. They decided that because of this they would wait for some time before coming to a final decision as to what they would do and this is a recognition of the fact that licence fees would have to be increased.

Some months later authority was given to RTE to go ahead with the second channel and there could be no doubt in anybody's mind that the new service would cost a sizeable amount of money with a consequent effect on licence fees. The decision, which was announced on 26 October this year, to increase the licence fees to finance the running costs of RTE 2 is a result of the various decisions to which I have already referred, but I am very pleased that the increases announced are not only less than what had been estimated by RTE in 1975, without allowing for the effects of inflation since then, but represent a smaller percentage of the licence fee required for the existing RTE services than seemed likely in 1975.

The estimate in 1975 for advertising income was £750,000; this year the estimate is £2 million. This clearly underlines the buoyancy of the economy. The present increase in licence fees is attributable in total to the increased costs arising from the operation of RTE 2 during RTE's current financial year. RTE estimate that the running costs will amount to £4.3 million in this period. The new service will give rise to an increase in the permanent staff of RTE of approximately 200. There will be over 1,000 hours of additional bought-in material necessary for the second service but there will be an increase of some 300 hours of home-originated material, including Irish language programmes, over current levels. I do not have to tell the House that the cost of home-produced material is significantly higher than the bought-in material and 300 hours additional home production represents an increase of over 20 per cent on current levels.

Deputy O'Toole queried whether the amount of money required was as high as the amount to be raised by increased licence fees. The position is that RTE proposed increases in fees which would produce an extra £2.3 million in the financial year ending 30 September, 1979. This was the amount estimated to be necessary to bridge the gap between the extra advertising income, which I have mentioned as being approximately £2 million, and the running costs of RTE 2 in the period. The increases which will come into force on 1 December were designed to yield this amount and there was no question of providing for anything else. There will also be volume increases in a number of other areas of expenditure, for example, power, maintenance, stocks of spare parts, telephone, telex and postal expenses arising from the operation of the new service. Interest payments alone on Exchequer funds advanced to finance capital expenditure for the new service will amount to £445,000 for the financial year ending 30 September next.

The running costs of RTE 2 will amount to £4.3 million in RTE's current financial year. This will be made up of £2 million from advertising revenue and £2.3 million which will be raised from the increased licence fees which have been allowed recently. To put the cost of the new national television service into perspective, perhaps it is worth while reminding Deputies that RTE's operating expenditure in their financial year just ended in respect of their existing services amounted to over £24 million. RTE estimate than in a two-channel situation increased advertising income of £2 million will be realised. I cannot repeat often enough that the difference between the running cost of £4.3 million and the estimated increased advertising income of £2 million must be raised by way of increased licence fees.

I do not think Deputies on the opposite side can be serious in putting forward the suggestion that there should not be any increase at all in licence fees. Deputy O'Toole made some comparisons between BBC and RTE and more or less wept for BBC on the basis that that body had to depend solely on licence fees and had no advertising income. Mark you, I understand the BBC are looking for quite a considerable increase in their licence fee at the moment. When one takes into account that television licence holders in Britain are in excess of 18,000,000 as compared with about 600,000 here and that the licence fees income of the BBC in the year ended 31 March 1977 was about £227 million as against £10.3 million for RTE plus £9.47 million from advertising I do not think there is any particular reason why we should shed any tears for the BBC. In fact, when one compares the total incomes and recognises that RTE has to produce and present programmes on the very limited amount they have as compared with the income enjoyed by the BBC there is no particular reason, I think, to decry the efforts they are making.

Deputy O'Toole spent quite some time referring to the National Prices Commission and to the fact that we had not brought these increases before that body. As he was told by the Minister for Economic Planning and Development the other day, in reply to a supplementary question, there is no precedent for the National Prices Commission being asked to recommend prices for the introduction of a new product or service and, of course, RTE 2 is a new service. There was, therefore, no reason why the National Prices Commission should have been approached in relation to these increases.

There is something more I have to say in relation to the National Prices Commission and the actions of the previous Government in regard to it and in regard to increases in licence fees.

Mr. Keating

What about the Fianna Fáil manifesto commitment to reform it?

Mr. Faulkner

I would like to deal now with the question of whether the National Prices Commission should, in fact, have been consulted before the Government decided on the amount of the increase. The increases relate solely to a new service, RTE 2, and because they do it would have been inappropriate for the National Prices Commission to recommend a charge. As I said, there is no precedent for the National Prices Commission being asked to recommend a charge for a new product or service. Deputies are aware that the Government recently authorised RTE 2 to proceed with a second national radio channel. I can assure the House that they are satisfied that this channel will finance itself from increased advertising revenue. No provision was made in the recently announced increased licence fees to finance this radio service. In any event, even if provision were made, the argument with regard to the functions of the National Prices Commission in relation to the determination of the charges for new services would apply to the new radio service as it applies to the new television service. I emphasise the increases authorised relate only to the second television service.

I am somewhat puzzled at the apparent concern of the Opposition in regard to the matter. It is worth putting on record that the National Prices Commission was established, as Deputy O'Toole said, by a Fianna Fáil Government in October 1971. There was no increase in licence fees from October 1971 until the change of Government in 1973. However, as I have already pointed out, there were four licence fee increases during the period of the Coalition Government. Two of these increases—those effective from 1 October 1973 and from 1 October 1974—were not, and I repeat not, referred to the National Prices Commission. The increases authorised by the previous Government with effect from 1 October 1973 also introduced a new colour television fee which represented a 100 per cent increase in the licence fee in force up to then. Remember, first of all, that in the first two licence fee increases the Coalition Government did not approach the National Prices Commission but on the third one, when an increase in licence fees was brought into operation and effective from 1 February 1976, the previous Government did seek the observations of the National Prices Commission, and that body recommended increases of £2.50 mono and £4.50 colour. Now the previous Government not only did not accept the recommendation of the National Prices Commission but they authorised increases of £4 and £7 respectively, increases more than 55 per cent greater than the increases recommended by the Commission. Looking at the record I am absolutely amazed at the stress put on this by Deputy O'Toole. In explanation of the decision not to adopt the recommendation of the Commission the then Minister for Posts and Telegraphs stated that the matter had been considered by the Government, who were satisfied that the increases recommended by the National Prices Commission would not have provided sufficient additional revenue in RTE's financial year ending 30 September 1976 having regard to the Authority's statutory obligation to be self-supporting. It was in only one case out of four, the last increase effective from 1 April 1977, that the previous Government accepted the recommendation of the National Prices Commission. Against that background the cries of concern from the Opposition benches ring somewhat hollow.

It is important to remember that RTE has a statutory obligation to be self-supporting. This duty is laid on it by section 24 of the 1960 Broadcasting Authority Act. The Authority's two main sources of revenue or income are advertising and a grant-in-aid equivalent to the net receipts from broadcasting licence fees. RTE are satisfied that in the present buoyant economic situation increased advertising income in a two-channel situation will amount to £2 million. Operating costs of RTE 2 are £4.3 million. Therefore, if they are to discharge their statutory obligation, the balance of the £2.3 million must be found from somewhere, and that is what is being provided in the increased licence fees.

RTE will provide a choice of television viewing for those viewers who, because of an accident of geography, have been restricted to one television service. The new service will help to provide a complete and comprehensive television broadcasting service for the whole country. It will have a strong non-metropolitan bias in RTE 2 home programmes and, as the service develops and resources permit, RTE intends that no place in the country will be more than 40 miles from an injection point to the RTE 2 network. A Programme Council strongly representative of the people of the single channel areas is being established to advise RTE on the selection of the best programmes available from BBC 1, BBC 2, ITV and some other sources for transmission. The Government are satisfied that the increases in television licence fees which will come into force on 1 December 1978 are the minimum necessary to cover the difference between the running costs of RTE 2 and the extra advertising income expected in the new two-channel situation. They are essential if RTE are to sustain their statutory obligation to be financially self-supporting. Remember, too, that in our term of government previously we also made available another new service in Radio na Gaeltachta in 1972. Let me emphasise again that during the Coalition period in office there were four increases in licence fees in four years as compared with three increases in 12 years under a Fianna Fáil administration. I emphasise that the increases sanctioned recently were for a new service while the increases sanctioned by the Coalition were to finance the continuing operation of services already there. The Coalition increases in 1976, which were not in accordance with the National Prices Commission's recommendation, were approximately at the same level as the increases allowed by the present Government without taking the inflationary situation into account in between times. The Coalition gave nothing extra for the money taken in licence fees but the present Government are making available a whole new service.

Mr. Corish

This matter was raised by way of Parliamentary Question last week and the Minister for Economic Planning and Development gave no information to those who tabled the question as to the reason for the present increase which we are discussing. The Minister has given some details of expenditure under various headings related to RTE 2 which he described as a new station or new channel but which I would regard as an extension of RTE. Despite what he says I am still not convinced that this is the only way of raising money—we are talking about television and radio licences but money is what we are discussing in the context of this resolution and the Minister's amendment. Last week we were told that the increase was to pay for RTE 2. The question was posed by Deputy O'Toole and has not been answered by the Minister as far as I can recall: what amount did RTE request when consideration was given to an increase in the licence fee? It is very difficult even with the information the Minister has given now to relate all this to the £7 per year increase in the licence. There was no notification beforehand, in the last five or six months when it was known that RTE 2 was to open in Cork, that there would be an increase in radio and television licences.

The Minister has said that on other occasions when an increase in television licences was proposed the matter was not referred to the National Prices Commission. He cannot be contradicted; that was indeed the case. But it was referred to the National Prices Commission in 1977 and it was assumed at that time that where an increase was proposed an application would go to the Prices Commission. If the Prices Commission had all the information the Minister has given tonight regarding costings they would be in a very good position to determine what the increase should be or whether the amount sought by RTE was too much or too little. We are still in the dark as to how the £7 per year increase is made up. The Prices Commission, I believe, would be able to determine whether the increase was necessary because radio and television is a consumer product and they are especially fitted to examine such applications.

It seems the licence holders are to bear the brunt of the establishment of RTE 2 or the extension of RTE to RTE 2. I did not hear the Minister say very much about increases in advertising rates and I should like to know what recent increases there have been in advertising fees. I believe these rates should have been increased and that the whole burden should not have fallen on the ordinary viewers.

The figures for the running of RTE up to 30 September last year are interesting. We see that licence fees amounted to £10.3 million; radio advertising, £2.3 million; television advertising, £7.8 million and other receipts, £2.1 million, a total of £22.5 million. The extraordinary thing about television and radio advertising is that the time provided is only taken up to the extent of 77 per cent. Could the Minister, or the Minister of State if he intervenes in the debate, tell us why only 77 per cent of advertising is sold. Is it too expensive? Is it because we have not sought extra advertising? If the additional 23 per cent should be taken up, while I cannot say what amount of money it would bring in, it certainly could provide some reduction in the £7 per year increase now suggested.

Licence fees accounted for 47 per cent of the total income of over £22 million for the year 30 September 1977. Advertising amounted to 43 per cent. I should like to know what RTE considers the balance should be as between income from licence fees and income from advertising. I believe that unless RTE receives financial assistance directly from the Exchequer, which in my view would be undesirable since it would inevitably lead to a diminution of RTE's independence, additional income can only come from increased licence fees or advertising. Would the Minister or some Member of the Government give us some information as to what efforts have been made to get 100 per cent of advertising time taken up and what increases were granted in recent times and whether it is contemplated that advertising rates should be increased at present.

The various Departments of State could contribute to advertising income on radio and television. Some Departments engage in advertising, the Department of the Environment in respect of road safety, litter and so on; the Department of Health also make a contribution—I do not say this is a gratuitous contribution for the sake of giving it to RTE; their advertising has been quite good but there has not been sufficient of it. While the Department of Social Welfare does a certain amount of advertising it might engage a little more time to tell the public through RTE what they are entitled to in respect of many social welfare benefits and forms of assistance.

I raised a matter previously with the Minister which is directly related to advertising, it is the establishment of community or local radio. It appears from replies I received to a question in the House that the Minister is either not in favour of the establishment of community or local radio or that he is not too particular about giving a decision in the near future. As far as I am aware, RTE have applied for a local radio in Dublin and in Shannonside but the Minister is reluctant to take a decision on that particular application. Those two places would be an additional source of revenue as well as the advertising that could be got from the establishment of local and community radio in various parts of the country. We have had, on an experimental basis for a very brief time, when there was some local event, local radio. As far as I know it was good quality and was well received by the people. It was certainly appreciated by the people in the locality where the radio was temporarily established.

The Minister should deal as expeditiously as possible with the application of RTE and decide to establish local radios in Dublin and Shannonside. He should think especially of the establishment of local radio in various parts of the country. There is great scope for the establishment of extra broadcasting transmissions, and they are technically possible. As far as the Department of Posts and Telegraphs are concerned there does not seem to be any urgency. I believe that RTE are very much concerned with this matter. I believe that the following range of broadcasting transmissions are technically possible—I referred to this some time ago but I believe I should repeat it now during this debate—two national medium wave channels, two national VHF channels, a range of regional channels including one in each of the large urban centres, the continuation of Radio na Gaeltachta and a range of local transmitters including mobile transmitters for smaller geographical areas. Possibly those things should be mentioned in the debate on the Minister's Department, but I am talking about those in the context of extra revenue. It appears to me that the only people who are to bear the brunt of the increase in expenditure by RTE 1 and 2 are the licence holders. Those are other methods by which extra revenue could be got.

I do not think I should quote the Fianna Fáil manifesto, but in it they are committed to the establishment of local and community radio establishments although there does not seem to be any move so far. The Minister should have another look at the election manifesto. I appreciate that they are only a year in office but the Minister has not given any indication as to whether or not in the lifetime of this Dáil such undertakings will be carried out.

The increase in the television licence fee will be a hardship on many poor people. There are many categories we regard as being poor, for whom free television and radio licences are being provided. A lot of those in the social welfare group, those over 66, those on old-age pensions, windows and orphans pensions, invalidity pensions and so forth get a free licence under certain conditions. I would like to point out that the free licence they get is in respect of the black and white television set. We should not condemn those people for the rest of their lives to black and white television sets. Some people might say that if they are so poor they surely could not afford a coloured TV. In many cases their families make them presents of coloured television sets. The Minister should consider issuing a free colour television licence to the people I have mentioned. There are also many others in the impoverished bracket who should be given a free television licence.

The Minister said that all of the increased fee goes to the establishment of RTE 2. I want to refer to a matter that was raised by another Deputy last week when questions were asked about this increase, that is, what is to be done in those areas where it is impossible to get RTE 1 and 2? If those people are required to pay for television licences RTE should ensure that they will receive the channels for which they are paying the licence money. As far as RTE 2 is concerned there were fears in many parts of the country that this new channel would block out reception of BBC 1 and 2, HTV and UTV. The former director general, Mr. Vincent Moloney gave certain assurances that there would be no interference in south-east Leinster and various other parts of the midlands.

Debate adjourned.