A fund containing more than €20 million of licence fee revenue will not be made available to TV and radio companies for several more weeks at least, following intervention by the EU Commission.

Following a Government decision made over two years ago, 5 per cent of the licence fee is now diverted into a special fund to support TV and radio programmes.

The fund has proved controversial because for the first time private broadcasters can apply for the funds, not just RTÉ.

This idea was strongly opposed by some senior officials in the Department of Communications who worried about diverting public money to private companies. Despite these concerns the Minister of the time, Dermot Ahern, pressed ahead with the idea and his successor Noel Dempsey has also given the idea support.

The Broadcasting Commission of Ireland (BCI), which is managing the fund, hoped to officially launch the fund in late July, but this has now hit an obstacle.

Following examination of the fund, known as the Broadcasting (Funding) Scheme, the European Commission has informed the Department of Communications that further information and clarifications are required before the idea can be approved. European Commission approval is required under State-aid regulations.

Michael O'Keeffe, chief executive of the BCI, said: "While the BCI had hoped to launch the broadcasting funding scheme in late July this will not now be possible following the receipt of this feedback from the European Commission.

"However, we will be working very closely with the department, to ensure that all the relevant information and clarification that the European Commission requires is provided to them within the next few days".