Committee of Public Accounts (PAC) concerned at time taken to make decisions on future of funding for public service broadcasting and reforms to current TV licence system

PAC also called on RTÉ to ensure that any liabilities to the Exchequer resulting from the Department of Social Protection’s investigation into RTÉ’s use of contractors, are financed through the broadcaster’s commercial revenue streams, or savings achieved in the organisation, rather than by Exchequer funds.

In its report published today on the Examination of the 2019 Appropriation Account for Vote 29 – Environment, Climate and Communications: Programme B – Broadcasting, and the 2020 Appropriation Account for Vote 33 – Tourism, Culture, Arts, Gaeltacht, Sport and Media, the Committee makes nine recommendations across four issues which were discussed with the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media and RTÉ at a number of meetings in 2020 and 2021. They concern:

1. The liability to the Exchequer resulting from the use of contractors by RTÉ;
2. Funding of public service broadcasting;
3. Decline in commercial revenues for RTÉ;
4. The gender pay gap and the remuneration of Irish-language workers at RTÉ.

Deputy Brian Stanley, Cathaoirleach of PAC, said “Between 2016 and 2018 there was some progress in tackling TV licence fee evasion. However, the level of evasion has increased again since 2018, reaching 15.8 per cent in 2020. In that same three-year period, the revenue An Post collected from the licence fee fell from €164 million in 2018 to €152 million in 2020. At the same time, the level of funding from the Department of Social Protection in respect of the free TV licence Scheme increased from €52 million in 2016 to €70 million in 2020.

“The Committee noted that reforms of the TV licence system have been recommended twice in recent years; by an Oireachtas Committee in 2017 and the Working Group on the Future Funding of Public Service Broadcasting in 2019. The Future of Media Commission, set up in 2020, also examined the matter, including ‘making recommendations on RTÉ’s role, financing and structure’. This report was recently presented to Government and the Committee would like to see the report published without delay so that any implications for public expenditure can be assessed.

“In 2018, the previous Committee of Public Accounts recommended that ‘the current television licensing system be reviewed as a matter of urgency with a view to decreasing evasion rates’. This Committee is concerned at the length of time it is taking to make decisions on the future of funding for public service broadcasting, and reforms to the current TV licence system. Reforms need to be made in light of the increased level of TV licence evasion, changes in how media is consumed, and decreased receipts from An Post for TV licence fee collection. This has given rise to the need for increased subsidies from the Exchequer to support public service broadcasting.”

PAC also noted that RTÉ’s accounts show a decline in commercial revenue from €158.2 million in 2016 to €134.5 million in 2020. Meanwhile, Exchequer funding to RTÉ for broadcasting licence fees increased from €179.3 million in 2016 to €197.6 million in 2020. The ratio between commercial revenue and Exchequer funding amounted to approximately 47:53 in 2016, compared to almost 40:60 in 2020.

Deputy Stanley said: “While solutions need to be found for reforming the TV licence fee system, there may be ways in which RTÉ can decrease its reliance on funding from the Exchequer, and increase funding streams from commercial sources. For example, RTÉ does not collect any revenue from content accessed via social media, although RTÉ confirmed to the Committee that it was in talks with Google in relation to a commercial arrangement between both parties.

“The Committee is concerned that while Exchequer funding to RTÉ has increased from 2016 to 2020, the broadcaster is not doing enough to reduce its dependence on State funding. The Department should engage with RTÉ to explore measures for reducing its dependence on Exchequer funding and provide PAC with a report by November 2022 detailing progress made on the matter.”

The Committee also examined two issues at RTÉ arising from the 2017 Review of Role and Gender Equality conducted by the broadcaster. The first is the liability to the Exchequer resulting from the use of contractors by RTÉ, while the second relates to the gender pay gap and the remuneration of Irish-language workers at RTÉ.

Deputy Stanley said: “Following the 2017 review, RTÉ commissioned a review of the broadcaster’s use of contractors. It was found that the contracts of 157 individuals were found to be in need of a further review as they had either attributes ‘akin to employment’ or ‘akin to both employment and self-employment’.

“RTÉ told the Committee it engaged with the Office of the Revenue Commissioners to address outstanding liabilities arising from these contractual arrangements and confirmed that it made a settlement with Revenue of approximately €1.2 million ‘in respect of identified liabilities’ for the period 2015 to 2018. However, no indication has been given to date as to how this figure was reached.

“A separate investigation is currently being undertaken by the Department of Social Protection (DSP) of the social insurance status of workers engaged by RTÉ. A further amount of PRSI may be liable if any individual was misclassified for PRSI purposes prior to 2015. DSP confirmed to the Committee that RTÉ are liable to pay Revenue any assessed arrears that exceed the broadcaster’s settlement with Revenue in 2021.

“The Committee is concerned at the potential loss of revenue to the Exchequer in terms of the PRSI that should have been paid by RTÉ in respect of any contractors found to have been misclassified for PRSI purposes. We are also concerned that any settlements in that regard may effectively be subsidised by way of Exchequer funding to RTÉ.

“The Committee would like the Department and RTÉ to provide a breakdown of the €1.2 million settlement paid by RTÉ to the Revenue in 2021, as well as ensure that any liabilities to the Exchequer, due to be paid by RTÉ resulting from the DSP investigation, are financed through the broadcaster’s commercial revenue streams, or savings achieved in the organisation, rather than by Exchequer funds.”

Deputy Stanley said the Committee also noted that the 2017 review found a 4 per cent pay differential between male and female staff at RTÉ. He said PAC is disappointed that RTÉ has not published information in relation to the gender pay gap at the broadcaster since the publication of the 2017 review. He also noted a commitment by RTÉ to conduct a review into the remuneration of Clár Reachtairí compared with their English-language counterparts.

He said: “The Committee recommends that RTÉ publishes information in its accounts on the gender pay gap at the broadcaster, and strives to reduce the gap within an appropriate timeframe. As well as gender parity, we further recommend that the Department ensures parity of remuneration for workers at RTÉ regardless of the language through which their work is conducted, as RTÉ receives the majority of its funding from the Exchequer.”

The PAC is a standing committee of Dáil Éireann which focuses on ensuring public services are run efficiently and achieve value for money. Further information on its role and remit can be found here.

The PAC Report Examination of the 2019 Appropriation Account for Vote 29 – Environment, Climate and Communications: Programme B – Broadcasting, and the 2020 Appropriation Account for Vote 33 – Tourism, Culture, Arts, Gaeltacht, Sport and Media is available on the Oireachtas website.