THE BROADCASTING Authority of Ireland (BAI) is nearly out of cash and would face a financial crisis if the proposed levy to fund it was annulled, Minister for Communications Eamon Ryan has said.
Mr Ryan said the BAI was able to rely on its cash reserves to get it through its first six months of operation, but this was now running out. The money had been saved in its previous guises as the Independent Radio and Television Commission (IRTC) and the Broadcasting Commission of Ireland (BCI).
Labour communication spokeswoman Liz McManus said she was surprised the BAI was trying to bill hard-pressed TV and radio stations for its operations when it could have paid for itself.
“Do you mean you were going to levy the industry for the €1.2 million when the authority had money? Why did you hit the industry in the first place?” she asked the Minister at a specially convened meeting of the Joint Committee on Communications, Energy and Natural Resources yesterday.
Members of the committee had unanimously voted on Wednesday to have the levy annulled.
Mr Ryan said the BAI needed the cash reserves. He was not in favour of annulling the levy, but he would look at waiving the €1.2 million cost of running the BAI between its setting up in October and the start of the year.
Annulling the levy would make it difficult for the BAI to borrow money to keep going while a new levy was being put in place, he explained. He told members of the committee that approving the levy did not mean the same as approving the BAI’s budget for 2010.
Independent radio and television stations will have to pay the new broadcasting levy to fund the BAI. They claim a proposed 26 per cent increase in the running of the BAI from €5.2 million in 2009 to €7.6 million this year is unjustified when their own revenues are down 20-30 per cent.
They are also going to be billed for the money outstanding from last year.
The statutory instrument bringing the levy into force is due to come into operation next Thursday unless the Government decides to annul it.
Mr Ryan said the work plan for the BAI would have to be approved by the authority’s board at its next meeting on March 22nd.
Its budget review was still in progress and he hoped it would return with a more “realistic” figure in the coming weeks.
“It does strike me that, in a difficult time when broadcasters are facing financial difficulties, we should be looking at tightening rather than expanding our budgets,” he said.
Mr Ryan said ways of delaying some of the BAI’s new legislative functions might be examined as a way of saving money.
Ms McManus urged that the Minister annul the levy on the basis that it was unfair. She said the tiered approach to funding would see small broadcasters pay 2.75 per cent of their income towards the BAI while RTÉ would only have to pay 1.25 per cent.
Ms McManus has tabled a motion in the Dáil next Tuesday to have the levy annulled.
She said it was essential for the process of transparency and fairness that the issue be debated fully.
