RTÉ has strongly rejected a consultant's report which claims the station has failed to reduce its staff numbers and radically alter its traditional work practices.
While the report by PricewaterhouseCoopers (PwC) is positive in large parts, RTÉ has rejected strong criticisms about staff numbers, budget planning and the station's ability to attract advertising. The station also rejected the idea that "financial optics" were behind its ability to bring in a surplus for 2003.
The report alleged that RTÉ allowed for a certain "slack" in its cost forecasts and was now able to compensate for a lack of revenue. The station said last night this was "misleading".
Director general Mr Cathal Goan is understood to be unhappy the report was not given to RTÉ management before this week so that comments could be made on it.
RTÉ last night circulated a consultant's report it commissioned by KPMG which is far more positive about the station's performance since the licence fee increase of December 2002.
RTÉ forecasts a profit of €22 million by 2007, but the PwC report suggested this might not be achieved if staff numbers were not reduced further and a "formal financial strategy" was not adopted.
On the staffing issue, the PwC report stated: "The overall level of staff resources within RTÉ is not reducing. In addition, we note that, in the 2004 Budget, staff numbers are budgeted to increase to 2,073." However, RTÉ rejected the calculations and said staff numbers would reduce by 110 people by the end of this year. The station said a number of people contracted to supply services to the station had - as recommended by a previous Goodbody report - regularised their employment in RTÉ and this played a part in the figures.
The PwC report was commissioned by the Minister for Communications, Mr Ahern. He used it to set RTÉ's licence fee for 2004.
The PwC report acknowledged the progress made by RTÉ in splitting itself into independent business divisions and praised the station for greater transparency in its financial affairs.
But it added: "In terms however of RTÉ's ability to drive changes throughout the full organisation, we are not yet convinced they have been successful."
It said judged on two criteria, reducing staff numbers and "up-skilling" the organisation , "it would be difficult to conclude that RTÉ has proven that ability". It suggested RTÉ introduce a more "realistic and aggressive budget" for 2004 and onwards.
On the issue of work practices, PwC said a number of changes were made in 2003 including self-editing by journalists, but there were no "clearly identifiable changes" due in 2004. It said management in radio and TV did not anticipate any "significant work practice changes".
The report also said with staff numbers not falling, it was hard to see what impact changing work practices were having on the organisation.
On the issue of advertising, the PwC report noted: "TV revenue is down on previous years and the value of an advertising minute has decreased between 2002 and 2003." RTÉ responded that it did not sell advertising by the minute but by TV ratings.
It also rejected the idea that clients were paying less for advertising. "As the ratings delivered have declined year-on-year, the average minute or airtime will have delivered fewer ratings. Therefore the reduction in the average amount paid per minute by an individual client does not mean they have paid less for the ratings they have purchased."
The RTÉ-commissioned report from KPMG warned the station that its priority ahead should be guarding its market share in the digital age. It said the station must be "pro-active" in assessing the trends likely to impact on its customer base.
