RTÉ reforms to include salary cap of €250,000 as State agrees to aid broadcaster with extra €56m

A salary cap of €250,000 will be introduced at RTÉ in tandem with plans to shrink the broadcaster’s workforce by 400 people between now and 2028, director general Kevin Bakhurst told staff on Tuesday as the Government confirmed it would give the broadcaster an additional €56 million in funding to overcome a short-term cash crisis.

Mr Bakhurst said RTÉ would remain a “substantial” organisation despite the loss of one in five jobs by 2028 and the requirement to close a €10 million gap in 2024 between its total funding and the money it needed to operate its services. Some 40 redundancies will initially be sought and cuts to content will be “confirmed in the coming weeks”, while other capital investments have been postponed.

Mr Bakhurst told staff the plan was “not about ripping the heart out of RTÉ” but described the measures as necessary to put the broadcaster on a sustainable financial footing.

Joe Duffy, Claire Byrne and Miriam O’Callaghan will face salary reductions under the new cap as they negotiate new contracts, with the latest figures showing Duffy on €351,000, Byrne on €280,000 and O’Callaghan on €263,500.

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[ RTÉ crisis: no staff on more than €250,000 under new plan, with some presenters facing cuts ]

[ It would make no sense to sell RTÉ's Donnybrook campus, says Bakhurst ]

The organisation’s new strategic vision states pay cuts will be delivered “as contracts expire and as we hire new people… and by reviewing and reducing allowances”. Mr Bakhurst told reporters he had not yet spoken to the “handful” of people at the broadcaster who would be affected by the cap.

Speaking to The Irish Times, Mr Bakhurst said RTÉ was shortly due to publish a number of independent reports into its corporate governance and “I suspect there will be some difficult reading in them.”

He declined to specify which programmes would be part of the content cuts due to be announced in the coming weeks. “I think overall we will have to look at all our main programming and decide whether it is better off in-house or whether there are opportunities for it to be made by the independent production sector.”

RTÉ's reform plan is to be closely supervised by senior civil servants and the release of new Government funding will be contingent on reform and cost-cutting targets.

It is understood the Government expects to make a decision on a new funding mechanism for the broadcaster in the new year, with licence-fee income dropping significantly since the RTÉ hidden payments controversy broke over the summer. While no detailed discussions have yet taken place, there remains extremely strong opposition from the Department of Finance and the Department of Public Expenditure to moving to a model under which RTÉ is directly funded from the exchequer instead of the licence fee. Instead, several senior figures expect that a new charge will be applied to all households, with the capacity to avoid the charge eliminated, and the existing television licence abolished.

However, a new funding model would be contingent on progress in reform and cost-cutting in RTÉ, senior sources stressed.

“There will be no new licence until RTÉ shows change,” said one senior figure.

The Government on Tuesday agreed a funding package of €56 million for the beleaguered broadcaster, with the first €16 million to be voted by the Dáil next week in a supplementary estimate and transferred to the station.

The remaining €40 million will be voted by the Dáil in the Revised Estimates Volume in early December, and will be transferred to RTÉ in two tranches next year – but only if the broadcaster meets certain conditions and benchmarks, senior Government figures involved in the process have made clear to the station.

[ RTÉ told €56m State bailout for next two years is ‘conditional’ on reform agenda ]

[ RTÉ bailout buys it time but money alone cannot fix credibility gap ]

The first €20 million will be given to RTÉ early in the new year when two reports into the station’s governance/culture and contributor fees, currently being examined by expert groups appointed by the Government, are published. It is widely expected in Government that there will be no delay to that payment.

However, the second payment of €20 million, expected in the summer, will depend on the achievement of targets and benchmarks overseen by NewEra, a unit in the National Treasury Management Agency which advises semi-State companies.

Several senior figures in Government who spoke to The Irish Times on condition of anonymity stressed that the second payment was not automatic and would depend on RTÉ making progress on cutting its operating costs and reducing its staff numbers.

“To get the first payment, the Bakhurst document must be on the road. By mid-year, it must be clear that the commitments are being implemented,” said one senior source.

Some senior figures insisted that the oversight of the implementation of the reform and cost-cutting plan would be undertaken by senior officials in NewEra and not by the Department of Arts and Media, RTÉ’s “parent” department.