Decisions made by the former minister for communications, Mr Ray Burke, forced RTE to subsidise its privately owned rival, Century Radio, in 1989, according to documents submitted by the State broadcaster to the Flood tribunal.
Two months later, the chairman of Century, Mr Oliver Barry, made a £35,000 cash payment to Mr Burke in the politician's office. The tribunal today starts a detailed examination of the circumstances surrounding this payment.
Senior executives of RTE, including one former director-general, and Department of Communications officials are among likely witnesses in the tribunal's investigation into the awarding of the first national commercial radio licence to Century in January 1989.
The hearings, which are expected to last up to two weeks, will also deal with Mr Burke's subsequent actions as minister as they affected Century Radio.
Members of the Independent Radio and Television Commission who made the decision to award the national licence to Century in January 1989 have been interviewed by tribunal lawyers and may be called as witnesses. The present IRTC has handed over to the tribunal all files in its possession on the period.
In March 1989, Mr Burke intervened in a dispute over the fees RTE was demanding from Century for transmitting its signal. Having started by asking for over £1 million, RTE later revised its demand to £614,000 a year. However, Mr Burke forced it to drop the price by a third.
In correspondence, which has been forwarded to the tribunal, RTE officials complained at the time that as a result, RTE was subsidising its rival. Century went on air in September 1989. When it collapsed two years later, RT E was left with unpaid bills of £500,000.
However, the co-founder of Century, businessman Mr James Stafford, is expected to use his appearance at the tribunal to criticise RTE and its role in the collapse of Century.
The tribunal is also interested in the circumstances that led Mr Burke subsequently to "cap" RTE's income from advertising. At the time, he described this as a move to "level the playing field" between RTE and private broadcasters.
Mr Barry told the tribunal last February he took the £35,000 for the donation to Mr Burke from a special account set up for income from a Frank Sinatra concert in May 1989. He handed over the cash in one of the politician's city-centre offices.
Asked by his lawyer if this was the only payment of £35,000 to Mr Burke, he replied: "Without a doubt, there was only the one £35,000."
