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Pay freeze for stars as RTE seeks €66m in cuts

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By Shane Hickey
Thursday Nov 6 2008

A number of RTE stars have indicated they are prepared to accept a pay freeze in order to help the cash-strapped State broadcaster weather the recession.

Yesterday it was revealed that plummeting advertising revenues have forced Montrose chiefs to chop €66m from their budgets by the end of next year.

Station management will meet with high-profile presenters such as Pat Kenny, Ryan Tubridy and Gerry Ryan to encourage them to take a salary cut over the coming weeks as they seek to keep a lid on costs.

An Oireachtas committee yesterday heard cutbacks of €16m were planned for this year, with a further €50m in cuts in 2009. They have been forced to take the drastic action after TV advertising revenues plunged in the past four months of this year.

Higher management have already agreed to cuts of up to 17.5pc, while 360 middle managers are also being asked to take reductions.

Staff across the board have been called on to accept a wage freeze and no pay increments or bonuses for 2009.

An RTE spokesperson last night confirmed the presenters, most of whom work on contracts with yearly increases, would be asked to share in the cutbacks.

"Senior management are going to talk to the presenters about the fact that the rest of the staff have taken these measures and wouldn't it be appropriate for them to do the same," the spokesperson told the Irish Independent.

While some presenters are on RTE staff, such as Derek Mooney and Sean O'Rourke, they get additional money for contracts as presenters.

Last year, a deal was signed to pay Gerry Ryan in excess of €600,000 a year for the next five years. In 2006, Pat Kenny was paid €850,000 -- an increase of almost €63,000 on the previous year.

The broadcaster is legally obliged to pay contract increases, which vary between presenters, and it has not yet been decided what cuts will be sought by management.

"Any presenter's contracts which will be negotiated now will be in a different climate and the expectation of increases would be resisted," said the spokesperson.

Last night, Derek Mooney said he would not be against the idea "once it is fair and across the board". He said that he would do as his bosses asked him as long as it kept everyone in full employment.

Miriam O'Callaghan has said that it would "only be fair" that presenters take a pay freeze or cut, similar to everyone else.

Director general Cathal Goan told the Joint Oireachtas Committee on Communications yesterday that €50m had been taken from next year's budget so that the broadcaster would not go into arrears, as it is legally obliged to do.

At the beginning of this year the station budgeted that it would have an €11m surplus, said chief finance officer Conor Hayes. However, the downturn had resulted in a projected shortfall of €27m for just 2008, forcing cost reductions.

Negotiations are now under way with staff for a system of "pain-sharing" which will result in personnel cuts of €21m next year along with €29m of "non-personnel" savings which will extend across all areas, said Mr Hayes.

Director of programmes at RTE television, Clare Duignan, said there would be immediate impacts on shows such as 'Tubridy Tonight', which will have one less camera on set; and 'the Late Late Show', which will employ fewer sound operatives.

Redundancies

The personnel cuts are likely to be through the non-renewal of contracts.

"It doesn't necessarily mean redundancies. it is possible to make payroll cuts without making people redundant," said the RTE spokesman.

Commercial revenue makes up over half (56pc) of the total RTE budget, the rest coming from the licence fee. Mr Hayes told the committee that it was mainly TV advertising which had been affected, with radio not as badly hit.

- Shane Hickey