That Dáil Éireann:
–condemns the Minister for Arts, Heritage, Gaeltacht and the Islands on her handling of the Broadcasting Bill, 1999, and deplores the total uncertainty she has created among the media and communications sectors, with particular reference to management and workers at RTE and TG4, who were not informed of any intention on her part to alter the proposed and accepted format of transmission management and control through the Company Digico;
–the lack of clarity in regard to income streams for RTE and TG4;
–the omission of digital radio from the Broadcasting Bill, 1999;
–her consistent avoidance of the issue of authorising the indexation of licence fees approved by the previous Government and non-action in the matter of considering a licence fee increase;
–her refusal to clarify her position to Dáil Éireann since her announcement of her intention to alter the Digico concept;
–her unwillingness to clarify her position to the Fianna Fáil Árd Fheis on the same subject, and
–her inability to provide an alternative model at her meeting with RTE;
–resolves that a substantial public shareholding be retained in the transmission system with appropriate guarantees;
–approves indexation of the licence fee authorised by the previous government; and
–in relation to the Broadcasting Bill, 1999,
rescinds the Order of Dáil Éireann referring the Bill to the Select Committee on Heritage and the Irish Language and hereby resolves that the Bill be withdrawn.".
This motion is born out of a sense of deep frustration and uncertainty created by the inept handling of the Broadcasting Bill, 1999, by the Minister to date. I regret that the Government is now characterised by a lack of vision, imagination and leadership. There is a deep mistrust within the broadcasting and communications network at the ability of the Minister for Arts, Heritage, Gaeltacht and the Islands, Deputy de Valera, to deal effectively with this Bill. I hope she will use the opportunity presented to her here this evening to state her views clearly, to tell the truth about her changes of view and to indicate what exactly she has in mind regarding Digico, RTE, its workers and the future of boardcasting as far as the Bill is concerned, and that she does not seek to hide behind some smokescreen. While the House, the workers in the industry and the country at large wait to hear her latest thoughts on the future of what used to be called broadcasting, it is regrettably the case that the broadcasting and communications agenda marches on without her and without us.
There is a peculiar and little known fact about the business before the Dáil this evening which I want to relate because it has a direct bearing on the motion. The present dilemma started on 23 February 2000, with the following headline in the Irish Independent: RTE Transmission Will Be Sold To Highest Bidder. The story stated that the Minister for Arts, Heritage, Gaeltacht and the Islands had decided to eliminate RTE's share in the privatised transmission company with the name of Digico and subsequent reports stated that the Minister intended to table appropriate amendments to the Broadcasting Bill, 1999, on Committee Stage. The peculiar and ironic twist to these stories is that the Bill is so vague and imprecise about what property is to be sold that it would be unnecessary to amend the Broadcasting Bill, 1999, to eliminate RTE's minority share. The Bill is so loose about what is to be conveyed that if passed into law as published the Government could privatise “The Late Late Show”, the film archives or the RTE car park; it does not discriminate.
The Bill does not specify a percentage ownership for RTE or any formula or means to arrive at a figure. The RTE shareholding could be reduced to a cipher without altering a single character of type. The Bill does not prescribe any process by which a private company is to come into ownership of all or a part of RTE transmission.
When I first read that headline in the Irish Independent, whose parent company has a vested interest in Princes Holdings, it came as somewhat of a relief because up until that headline it was unclear by what criteria the Government intended to choose between different prospective owners. There was some mention of negotiating with suitable prospective strategic partners, a concept which is difficult to reconcile with the legal niceties of a complete or partial privatisation. The Bill refers to privatisation in one place only, where it states that RTE should:
transfer such parts of its real and personal property as the Authority, with the consent of the Minister and the Minister for Finance, determines ought to be the subject of such a transfer.
When one reads that, the words "blank cheque" come to mind. Until now, we have been asked to endorse the sale of whatever components of RTE the Minister, Deputy de Valera, and the Minister for Finance, Deputy McCreevy, think fit. The two Ministers will forgive us on this side of the House if we, who are not in the habit of handing over wallets to strangers, are sceptical of these arrangements. We, who are not inclined to pre-sign cheque books, are in need of a great deal of precision when it comes to the sale of £30 million to £60 million of State property. We, who are not inclined to sign contracts before we read them, prefer that the Broadcasting Bill, 1999, should enumerate the assets to be included in the sale. The Bill, which authorises a transfer of assets, should also regulate that transfer. It appears that the Bill is now unravelling on this very point.
I will state a brief history of the Bill, in particular, as it relates to the Digico proposal and the RTE shareholding. In late 1997, RTE proposed to the Government that it should enter into a strategic partnership to provide the necessary funding for the introduction of digital terrestrial television. On 22 July 1998, the Government announced its decision to draft broadcasting legislation. The press release issued by the Department of Arts, Heritage, Gaeltacht stated:
I and the Government have accepted that the proposals – which would involve RTE entering into a partnership for the provision of technical facilities to broadcasters in Ireland – provide the best opportunity for the early roll-out of the infrastructure that will guarantee universal service.
A project management group was formed in February 1999 to advise on the sale of the existing RTE transmission network. The press release on the establishment of the project group referred to "the new entity to be created in which RTE will be a minority partner".
The Broadcasting Bill was introduced to the Dáil on 27 May 1999. In November 1999, the Office of the Director of Telecommunications Regulation opened a consultation paper on digital terrestrial television licensing, which still remains open, awaiting the passage of the Broadcasting Bill into law. The Bill was debated by the Dáil in November and in her opening speech the Minister stated:
[The Broadcasting Bill] enables me, as Minister for Arts, Heritage, Gaeltacht and the Islands, to designate a company which will be licensed by the Director of Telecommunications Regulation to construct and operate the DTT infrastructure which shall comprise six transmission systems known as multiplexes. RTE will be a minority partner with a shareholding of up to 40 per cent.
Later, on the subject of Digico, she stated:
The approach taken is in line with RTE's suggestion for the development of digital television in Ireland.
Then the Dáil sent the Broadcasting Bill, 1999, to the Committee on Heritage and the Irish Langu age. A series of four hearings were held by the committee between December 1999 and February 2000. The committee heard presentations from a range of groups, including RTE, the RTE workers' trades union, TV3, TG4, UTV, Cablelink, Irish Multichannel, the ODTR, the Independent Radio and Television Commission, the Independent Broadcasters of Ireland, Crown Castle, which is a prospective bidder, and others too numerous to mention here.
Then on 23 February 2000, without reference to that committee or its hearings, the Irish Independent carried the headline, This Time There Was No Press Release. This time, after saying that 70% of the story was true, the Minister was incommunicado in Los Angeles. She could not be contacted despite all the technology which exists including the worldwide web, GSM and all sorts of mobile telephones. Subsequently the Minister said in her speech at the Fianna Fáil Ard Fheis: “I have not finalised my proposals to amend the Broadcasting Bill, but I hope to do so in the next few weeks and then bring them to Government for approval”. The Bill, is currently before the Select Committee on Heritage and the Irish Language which has not yet attempted to splice in the numerous amendments already tabled.
The Labour and Fine Gael parties have attempted to extract an explanation from the Minister during Question Time why the sudden shift in direction occurred. The answers to our questions do not depend on her proposed solutions, so we do not agree with the need for a delay. All we got for our troubles was a robotic recitation of rubbish from Mespil Road. For example, "the development of a transaction process which satisfies all the requirements of the project management group and the Government objectives to introduce digital terrestrial television has proved difficult and complex". This much we already knew but, as public representatives and Members of the Oireachtas, we have a right and need to know what his going on.
The project management group has been in business for over a year. If they have suddenly discovered that under EU rulings they cannot just put a price tag on State assets and then find some nice people to buy them, we have a problem. This news has created havoc in RTE whose employees were looking forward to a new career in the private sector with the prospect of an employee stock option plan which their representatives were in the process of negotiating. Now, for all they know, they are facing a P45 instead of an ESOP. It must be a bit of a roller coaster for employees, particularly for those who may have purchased new homes in the past few years or are repaying hefty mortgages. The Minister has launched a wave of uncertainty upon RTE which is still washing around its corridors and will not subside until she does something about it. She owes these people an explanation now and not at some vague time in the future.
Item 1 in the 1999 framework agreement on partnership in RTE refers to the scope of the agreement saying: "This agreement covers RTE and all subsidiaries under the control of the RTE Authority. It is subject to the obligations and duties, whether direct or delegated, of the authority contained in the Broadcasting Acts". The document defines the framework, which the Minister's action have seriously interfered with, as follows:
It is a relationship whereby each side recognises that the other has legitimate interests and rights as well as obligations. Partnership implies that both parties have common interests in the success of the organisation, its competitiveness, viability and prosperity. The parties are committed to creating a shared understanding of the future of RTE and to sharing the responsibilities and gains that flow from that understanding.
Has the Minister's sudden change of heart and view not seriously interrupted the delicate and meaningful negotiations which were being conducted between management, the trade union group and the people involved in the transmission network? I am not sure if her announcement last night on the "Nine O'Clock News" regarding a facilitator was the result of discussions at the Fianna Fáil Ard Fheis.
All this could have been avoided if the three-fold structure of the Broadcasting Bill, the privatisation of transmission assets and the licensing regime had been planned and organised more carefully in advance. In the absence of any definitive statement from the Minister we must speculate.
There are several possible reasons for a decision to eliminate RTE from a minority shareholding in the designated company in the Broadcasting Bill. It is well known that TV3 and the independent radio broadcasters are unhappy with the prospect of their major competitor sitting on the board of Digico, which would be their sole distributor. Second, one or more of the prospective bidders may have balked at the strategic partnership with RTE and preferred a total buy-out – this was made clear to us at the committee. We could accept what the newspapers say, namely, that it had to do with the valuation of RTE's transmission assets. If that is the case then it is only half the story, as I will explain. It could well be that the Minister has finally conceded that certain provisions in the Bill are not compatible with the EU Treaty, as we warned throughout the Second Stage debate. Finally, it may be that the plans had become unravelled due to a shift in EU regulatory policy published in the November 1999 communications review entitled "Towards a new Framework for Electronic Communications Infrastructure and Associated Services".
Let us consider what the papers say, namely, that it had to do with the valuation placed on the RTE assets by the project management group consultants. What was the purpose of the evaluation? Anything is worth what it can be sold at on the open market and a transaction is not additionally complicated by a sale of part ownership. For example, if 60% of a company was being offered for sale and the highest bid was £60 million, then one could say the company was worth £100 million and that the part not being sold was worth £40 million. There is no particular problem in evaluating this. However, a dilemma arises if one is selling two things together, for example, a company and a large tract of land which are not owned by the same person. One cash figure will attach to both assets and there is a predicament in dividing the money between both owners. It has not been stated, but we may surmise that the evaluation was necessary primarily because the sale of RTE assets was tied to a frequency option in the same bidding process. The highest bidder for the existing transmission assets was also going to get a majority share of the DTT which represent a certain cash value of their own. The assessment was necessary to distinguish between these two holdings because they belonged to two different owners, namely, RTE and the State.
The Broadcasting Bill is very clever in this regard. It appears to separate these two by giving the Minister power to designate a transmission company, but we all know the designated company is identical with the owner of the privatised RTE network. The Broadcasting Bill does not authorise a frequency option. It permits an outright grant of valuable frequencies to a private company. However, the reality of the frequency option was not lost on the advisers to the project management group. They ordered an evaluation so it could be subtracted from the highest bid with the remainder to go directly to the Department of Finance in order to avoid an unauthorised State aid to RTE. According to the newspapers RTE did not agree with the valuation as it was too low and amounted to a bargain basement sale. So the Minister announced she had decided to sell the entire RTE network instead.
However, there is still a missing link in this story. The Minister for Arts, Heritage, Gaeltacht and the Islands on behalf of the Government appoints the authority of RTE and the members of the board at her pleasure. The current board is coming to the end of its tenure and within the next few weeks an announcement will be made about new members of the new authority. I hope the announcement is made either to the committee or the Dáil and not on the steps of an aircraft on the way to New Zealand, Shanghai or Alaska, as happened in terms of the comment following the leaked story in the Irish Independent. These are very important positions and, given the complexity and importance of broadcasting and communications for the future, the Minister should inform the House of the qualities of the persons she intends appointing in terms of their future remit on the authority. I am not sure whether my eyes deceive me, but it appears at least as if some likely looking characters have been seen escorted across the bridge of sighs towards the opulence of the ministerial quarters ready to serve when they get the call in the national interest.