Thursday, 12 July 2012

Questions (162, 163, 164)

Michael Healy-Rae

Question:

165 Deputy Michael Healy-Rae asked the Minister for Communications, Energy and Natural Resources his views on the fact that Independent Broadcasters of Ireland, who rely entirely on advertising to fund broadcasting and operational activities, are at an unfair disadvantage to RTE; if a fairer system of financing local radio network will be put in place; and if he will make a statement on the matter. [34138/12]

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Michael Healy-Rae

Question:

166 Deputy Michael Healy-Rae asked the Minister for Communications, Energy and Natural Resources his views on whether an amendment of section 108 of the 2009 Act to define and limit the commercial mandate of RTE would be in the interest of fairness, in particular to the independent broadcasters of Ireland; and if he will make a statement on the matter. [34139/12]

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Michael Healy-Rae

Question:

167 Deputy Michael Healy-Rae asked the Minister for Communications, Energy and Natural Resources his views regarding funding of the BAI from the new household broadcasting charge; and if he will make a statement on the matter. [34140/12]

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Written answers (Question to Minister for Communications, Energy and Natural Resources)

I propose to take Question Nos. 165 to 167, inclusive, together.

I fully recognise the contribution of the independent radio sector in bringing diversity to the airwaves, and serving the needs of communities, often at a very local level. As I noted when I addressed the Independent Broadcasters of Ireland (IBI) Annual Conference earlier this year, "Local radio gives a voice and enhances social dialogue for people of all ages ... it provides a forum for local communities; it enhances a local community; its gives confidence to people and indeed is an expression of the community in which the station is broadcast".

However, it should be clear that these stations were founded as commercial operations with creating a profit for their owners as their primary objective. Station owners sought and accepted licences on clear commercial terms. In many cases, their success in the licence application process was assisted by the voluntary commitments they gave in regard to the provision of public service type content, over and above that required by the relevant legislation. The fact that some of these stations are now undergoing an understandable degree of financial stress does not mean that the State should immediately step in and provide funding — they are and remain commercial companies. Moreover, it should also be noted that their very popularity in the communities they serve is, in many cases, as a distinct result of the local news content and current affairs type programming that they provide and which, in turn, gives them a powerful advertising presence and thus earning potential. As the economy recovers, it is to be expected that this commercial pressure will ease as advertising revenues recover apace.

In practical terms, EU State Aid rules provide a serious and unavoidable obstacle to the IBI proposal. The Principle of Additionality means that State funding can only be provided to companies where, in the absence of such funding, the service would not be delivered. The fact that the commercial broadcasters already provide a range of public service content voluntarily would clearly rule out the provision of any state funds on this basis.

As the Deputy may be aware, the Broadcasting Authority of Ireland (BAI) is presently engaged in the first "5 year review" under Section 124 of the Broadcasting Act 2009. This review, which builds on the single year reviews completed thus far, will examine issues in relation to Section 108 of the Act and the commercial funding of these corporations as well as the impact of further "top slicing" of the available licence fee fund. As such, I expect that it will fully engage with questions around RTÉ's presence in the advertising market, and the nature of their commercial remit. I will, of course, consider any suggestions or recommendations that may emanate from this around legislative change. Equally, I remain of the view that the existing BAI Levy system is the most appropriate means by which that organisation should be funded, unless of course, a compelling reason is brought forward in this review.