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Cash squeeze won't allow RTE to reverse pay cuts this year

STAFF at RTE will not see the salary reductions imposed 18 months ago reversed this year.

But a further raft of cuts is thought unlikely even though the broadcaster will need to find €15m extra to balance the books this year because of Government cutbacks, the Irish Independent has learned.

The outgoing director general Cathal Goan addressed staff in the television centre at lunchtime yesterday following a presentation by Eugene McMahon of Mazars on the financial situation at Montrose.

"It made for grim listening," one staff member said last night.

It is understood the independent financial review indicated that previous cost-cutting measures at RTE had worked well, but the organisation will come under severe pressure again this year because of last December's Budget.


The problems include finding over €6m to help fund TG4 after a drastic cut in Exchequer funding for the Irish-language station, €2m-€3m to make up a shortfall in social welfare payouts for pensioners' tv licences, and millions more for the roll-out of digital terrestrial television.

"We have been very badly hit by government decisions which, if you add them all up, come to about €15m, and you can't take a hit like that in the current climate and expect to come up smiling," one source said.

The end of 2010 independent financial review was promised as part of the pay reduction agreement in spring 2009.

At the time, staff at the station agreed to take cuts of between 2.5pc and 12.5pc, while the station's big names such as Pat Kenny and Ryan Tubridy -- who are employed as independent contractors -- took cuts of at least 10pc to their large salaries.

The agreement, which was aimed at saving €10m, ended at the end of December, but staff members -- many of whom failed to attend the meeting yesterday -- hold out no hope of their salaries returning to 2009 levels.

Nonetheless, RTE management and the RTE Trade Union Group(TUG) will enter into discussions later this month.

"RTE's position is that the review clearly indicates that RTE is not in a position to reinstate," an RTE spokesman said.

"The presentation by Eugene McMahon presented a very, very challenging picture of what RTE is facing for the next year and the TUG will now be sitting down to discuss the implications of this," a TUG spokeswoman said.

The state broadcaster's financial difficulties have raised the possibility of another series of wage reductions in what will be a tough 2011 for the station, .

However, informed sources have indicated to the Irish Independent that more cuts are unlikely this year.

Irish Independent