Television Licence Fee to increase

The Government has agreed to a proposal from the Minister for Communications, Marine and Natural Resources, Noel Dempsey T.D., to increase the television licence fee by €3. The new licence fee will be €158 with effect from 1st October 2006.
A Corporate Plan 2006-2010 was received from RTE in March 2006. The receipt of this plan was one of the conditions for the TV licence fee increase of 1 April 2005.

An independent review of RTE’s performance in 2005 was undertaken by Indecon Consultants. In its report Indecon concluded that RTÉ had performed well in the context of delivering on its output, financial and change management commitments. Indecon reported that RTÉ has broadly succeeded in fulfilling its corporate and financial commitments and met or exceeded its output commitments on television, radio, publishing and performing groups.  The Indecon Report is available to download here.

“Having regard to all of the circumstances it is considered that there is a strong case for approving an increase in the level of the television licence fee. The principal reason for this is that it will provide RTÉ with the means to further strengthen the schedules it delivers the audience in circumstances where Indecon have reported that RTÉ is providing value for money,” said Minister Noel Dempsey today.

In considering the level of increase that might be approved it is suggested that an increase of less than Consumer Price Index (CPI) should apply. The annual rate of CPI in the year to April 2006 was 3.8%, which would equate to an increase in the cost of a licence fee of almost €6. Having regard to the conclusions of the Indecon report, coupled with the significant increase in other revenue projected, it is proposed that the cost of a licence fee would be increased by €3 (from €155 to €158) with effect from 1 October. This increase will provide RTÉ with an estimated increase in public funding of just under €2m in 2006 (or almost €4m in a full year). In addition it is estimated that RTÉ will benefit from an increase in public funding of in the region of €6m from a combination of new household growth and reduction in the level of evasion.

The increase was recommended subject to the following conditions:

- That within one month of the decision RTÉ would bring forward proposals, based on the Indecon recommendations, as to the steps that RTÉ will take in 2006 to ensure it can provide a greater assurance that it is meeting its commitments to the public and providing value for money in doing so.

- That RTÉ will engage as required with the Department in relation to the agreement and publication of its strategic corporate plan.