RTÉ media committee hearing: Former chief financial officer Breda O’Keeffe was paid €450,000 to leave, Bakhurst says

RTÉ executives and board members appeared before the Oireachtas media committee (again) on Wednesday in the wake of a string of controversies to hit the public service broadcaster. Among those appearing before TDs and Senators are RTÉ director general Kevin Bakhurst and chairwoman of the RTÉ board Siún Ní Raghallaigh.

Senior figures from RTÉ have been invited back before the committee in the wake of the Grant Thornton report on the loss-making Toy Show the Musical and the separate McCann FitzGerald report voluntary exit scheme payments at the broadcaster.

Main points

• Bakhurst says former chief financial officer Breda O’Keeffe was given a redundancy payout of €450,000. He says he has “full confidence” in under-fire director of human resources Eimear Cusack, who issued the offer letter on the instruction of Forbes. He declines to give details of other executive payouts
• Bakhurst says he received a solicitor’s letter on behalf of O’Keeffe yesterday telling him he should say certain things to the committee
• Ní Raghallaigh acknowledges a lack of board oversight of the musical, but notes that it was “not kept appropriately informed” as it was being developed. “Dysfunction at the top is now gone,” she says
• There are once again some conspicuous absentees, including Forbes, former chairwoman Moya Doherty and former director of strategy Rory Coveney. Committee chair Niamh Smyth wrapped up today’s hearing by calling again for their appearances before the committee
• Bakhurst says he took decision to pull advertising for licence fee sales and renewals last summer as RTÉ thought it would be “tone deaf” and “disrespectful” at that point
• Cusack says “she wasn’t afraid” of Dee Forbes when questioned about her role in the agreement for O’Keeffe to leave under the exit scheme
• Board member Anne O’Leary alleges that Forbes and Coveney “deliberately circumvented” RTÉ's risk procedures on Toy Show the Musical. Committee chair Niamh Smyth says the board was “deceived”, and O’Leary says “I feel there was an element of deception”
• The director general also says he “was quite surprised to read” that the creative process for musical was “so chaotic” and if this is the way it was run, it is another contributory factor to its failure
• Bakhurst says that there are no other scandals lying in wait, as far as he is aware. He also says that RTÉ was run in an “ad hoc, loose and, in my view, often unprofessional way”
• Bakhurst says about 10 people have not agreed to reimbursements proposed as part of a collective agreement between RTÉ and its unions over bonus self-employment practices. RTÉ has said it “will not hold it against” them if they escalate their cases to the Workplace Relations Commission

Best reads

• Dee Forbes’s sick note should not be allowed to get in the way of the public’s right to know, Fintan O’Toole writes
• Media committee chairwoman Niamh Smyth says the absence of ‘key people’ has become a ‘farce’
• RTÉ can’t afford to show the new season of The Young Offenders this year – even as the BBC prepares to do so (my column this week)
• Pulling the Toy Show musical due to poor ticket sales would have been ‘unthinkable’, Rory Coveney said
• Who would want to serve on the RTÉ board now?

After four hours, that’s more or less it from the committee, with Niamh Smyth wrapping up its business for the day saying she accepts “the bona fides” of Ní Raghallaigh and Bakhurst and calling once again for no-shows including former director general Dee Forbes to attend.

Until next time...

Fine Gael Senator Martin Conway, who we are led to understand will be the last person to speak, asks about the sale of Montrose, RTÉ's campus in Donnybrook.

Bakhurst, as he previously indicated last autumn, says the plan is to offload part of the site and “shrink back” on it rather than selling it in its entirety, but that the valuation received by RTÉ was “disappointing”, in part because of the number of listed buildings on the site.

He says developers have told him there might not be an “appetite” for the land even at this underwhelming price tag, given the state of the Dublin office market. It may be the case instead that the State can find another use for the land.

This process won’t happen overnight: “It will probably take five to eight years to implement it, because we will need to move people around, move the newsroom around, so it is quite complicated.”

Conway, as might have been predicted, is not the last person to speak.

Malcolm Byrne comes back in to ask a question I suggested someone should raise earlier in connection with Toy Show the Musical, which is why only 35 shows went on sale, not 44 or 54 as had been suggested in various presentations – figures that made the project seem less risky than it really was. Board member Daire Hickey says he was told that there would be “a slow release” of shows and that he understands the venue was booked for 54 performances, even though this number never went on sale.

Byrne suggests that RTÉ should make the rights to Toy Show the Musical available for free to amateur musical societies around the country.

Smyth asks about staff and former staff who have lost out as a result of RTÉ's legacy bogus self-employment practices.

Bakhurst says about 10 people have not agreed to the reimbursements proposed as part of a collective agreement between RTÉ and its unions and that he has heard their individual stories.

“I do feel that they have been badly treated by the organisation,” he says. But he adds that it would not be right to unpick a collective agreement accepted by 80 per cent of the people involved.

He says he has told the individuals concerned that RTÉ “will not hold it against” them if they decide to escalate their cases to the Workplace Relations Commission.

Niamh Smyth, the committee chair, begins with an appeal to Dee Forbes, Moya Doherty and Rory Coveney to appear before it.

She says she went to a performance of Toy Show the Musical in December 2022 and it was “pretty obvious to anyone who attended that there was a real problem and a real issue”.

The board of RTÉ was “deceived” about the musical, Smyth says. She asks board members for their views.

“I feel there was an element of deception,” says Anne O’Leary, while others only go as far as to say that information was withheld.

David Harvey says “jaw-dropping” things happened within the organisation but that a huge job is being done to turn it around.

“You set the tone at the top and the tone was wrong,” he says.

Daire Hickey says “the way in which information percolates through the organisation” has changed (for the better). Jonathan Ruane, appearing by video-link, highlights the importance of resolving the funding question in light of the upcoming general election.

Siún Ní Raghallaigh says the “dysfunction at the top is now gone”.

Just a few other things Kevin Bakhurst has said so far about RTÉ's current financial predicament:

• If TV licence fee sales improve, RTÉ may not need the full €40 million that the Government has said it will provide in interim funding this year.
• In January, licence fee sales “improved quite considerably”, although the last week was “not so good”.
• Commercial income is “performing very well” at the moment, including early sponsorship interest in its broadcast of the Olympic Games this summer.
• RTÉ's new commercial director, Gavin Deans, started last week, while media agencies – the companies that buy advertising on behalf of clients – continue to support the organisation.

Fianna Fáil TD Christopher O’Sullivan wants to know about the nature of former chief financial officer Richard Collins’s exit from RTÉ. Bakhurst says he cannot go into individual cases.

“The public are sick of it,” O’Sullivan says.

“I’m sick of it too, Deputy, but I took legal advice,” replies Bakhurst.

After some to-and-fro on this subject, O’Sullivan directs questions to Cusack about Breda O’Keeffe’s €450,000 voluntary redundancy payment. She says in hindsight she should have pushed back more. He says Cusack showed “a lack of due diligence” as a director.

“It did not enter my head to go over the head of the director general,” says Cusack.

Bakhurst – who says he has “full confidence” in Cusack and that he needs her on his leadership team – responds that it is “unfair” of O’Sullivan to say that former RTÉ executives not present at the hearing are being “scapegoated”. Anne O’Leary also objects to O’Sullivan’s take.

Sinn Féin TD Thomas Gould asks Bakhurst for a total on the exit payments paid to RTÉ executives – including one to Rory Coveney — who have departed since he came in as director general last July.

Bakhurst replies that he cannot give the figure now, as it will prompt “process of elimination”-style guessing, but that the total will be published in RTÉ's annual report for 2023. He says RTÉ would rather not pay out public money when people leave, but it depends on the circumstances of the person’s departure. Sometimes there is an “agreed resignation”, he says, and there are “tricky legal constraints” around the exit.

“I’m afraid there is a price, but for me I needed to refresh the leadership team, so it was a price I had to pay,” he says of payments made when the need arises to “exit” people at senior level.

Asked about prosecutions for non-payment of the licence fee, Bakhurst says he hates seeing them. He would much rather there was a funding system that is “progressive and fair and enables us to deliver for audiences”.

He says anger about Breda O’Keeffe’s €450,000 redundancy payout is shared by everyone in RTÉ and repeats that he agrees with them and that it wouldn’t happen now.

He welcomes again the debate about how RTÉ will be funded in future.

“Public service broadcasting in my view has huge value to society. You look at countries that don’t have it and you wouldn’t want to live there.”

Carrigy puts it to Eimear Cusack, who issued the formal offer letter to Breda O’Keeffe on the instruction of Dee Forbes, that her position is not tenable.

“I trusted her, I would not have thought about going over her head to the board… and that’s just the truth of it,” the director of human resources says of Forbes by way of defending herself.

Bakhurst says the incident reflects the way RTÉ was run under Forbes and that the broadcaster has put in place procedures that mean it cannot happen again.

To recap, O’Keeffe received €450,000 to leave RTÉ under a redundancy scheme, Bakhurst revealed earlier, despite the fact that this did not lead to any cost savings and the decision has left RTÉ with a likely liability to the Revenue Commissioners.

“She is an important part of the leadership team,” Bakhurst says of Cusack, while also noting that he is “not afraid” to make changes at executive level.

Kevin Bakhurst says that RTÉ was run in an “ad hoc, loose and, in my view, often unprofessional way”, but that the legal advice he has received is that no laws were broken.

The director general adds that he hasn’t spoken to former chairwoman Moya Doherty about Toy Show the Musical, although that would be helpful.

“As you know, she hasn’t been very available,” he says.

Fine Gael Senator Micheál Carrigy gets his 10 minutes. He starts with Toy Show the Musical and follows Shane Cassells’ lead by asking Adrian Lynch, as one of the surviving members of the RTÉ executive from 2022, about why neither he nor Rory Coveney highlighted concerns to the Oireachtas committee in 2023.

Lynch reiterates that it wasn’t a case of concealment and that Coveney had been the project lead. Carrigy says the questions were put to both him and Coveney. Lynch says that Coveney’s view was that the project had been properly approved.

Anne O’Leary stresses that when the audit and risk committee went looking for information in relation to the musical, it expected to receive it and have a robust discussion about the project, as it had done for 33 other projects in her time on the committee.

“They didn’t do their job, [it’s] not I didn’t do mine.”

Kevin Bakhurst, being questioned by Fine Gael TD Alan Dillon, says Breda O’Keeffe was paid €450,000 to leave RTÉ.

He reveals the number only after citing “significant legal pressure for months” in relation to the McCann FitzGerald report.

Earlier in the committee hearing, he said he received a letter from O’Keeffe’s solicitor as late as yesterday about what he should say at the committee.

Eimear Cusack says she was “not told about the rationale” for the payment to O’Keeffe. She says she did not conceal anything, but “processed something under instruction” from Dee Forbes.

Fianna Fáil Senator Shane Cassells says the words of Bakhurst and Ní Raghallaigh, despite the fact that they were not at RTÉ at the time of Toy Show the Musical was launched, are “a bit like the White Star Line apologising for the sinking of the Titanic”.

He turns his attention to RTÉ director of audience, channels and marketing Adrian Lynch and says he was “bullish” on the subject of the musical at Oireachtas media committee hearings last year.

He quotes Rory Coveney’s remarks about the musical in January 2023, in which he said the musical was “not a whim” and it was “very proud of it”.

Lynch says he wasn’t involved in the production and if he had been asked questions about the musical at previous Oireachtas hearings, he would answered them.

“I actually learned quite a lot myself from Grant Thornton 3 [the Toy Show the Musical report] that I was unaware of,” says Lynch.

However, having attended the musical in December 2022, it became obvious to him then that there was a financial issue. He notes that Coveney was still hoping that the show could be “salvaged” by turning it into a multi-annual project.

Lynch is asked about the nature of the contract with the venue, Convention Centre Dublin. He says he doesn’t know anything about it. Cassells asks if anyone present from RTÉ knows anything about it.

“Nobody,” he says, after no one answers.

Bakhurst is asked why Coveney felt he had to resign. He says that Coveney came to the conclusion that his position was not tenable in the organisation and that it was the honourable thing to do to resign, and that he regrettably agreed.

Was an exit package agreed with Coveney?

“Yes, there was,” says Bakhurst.

After a brief break, Sinn Féin Senator Fintan Warfield is up and observes accurately that this has been “dragging on since June” and that the Government needs to take action on the licence fee.

It needs to be scrapped, but the Government still refuses to act on it. If it really wanted to sort out public service broadcasting it would accept the recommendation of the Future of Media Commission that public media be funded directly through the exchequer.

Indeed, with so many interim funding injections, RTÉ is partially funded this way anyway.

“I don’t see the problem [with direct exchequer funding],” he says.

Kevin Bakhurst says he welcomes the fact there is “a real live discussion” about how best to fund RTÉ.

“This is not a decision for RTÉ, you’ll be pleased to hear, it is a decision for the Oireachtas.”

It is a “golden opportunity” to resolve this for the future.

Bakhurst says he was grateful to see a letter from Screen Producers Ireland acknowledging the role RTÉ plays and says that the broadcaster will ensure that independent production companies are its “true partners”. He visited the Dancing with the Stars studio at the weekend, he says, but it is “extremely hard” for companies like the show’s maker, Shinawil, to plan for the future when RTÉ itself is unable to plan long-term.

Labour Senator Marie Sherlock becomes the second committee member to raise playwright Lisa Tierney-Keogh’s piece in the Irish Independent today in which she said the Toy Show the Musical script had not been written by the time the project was being pushed through by Dee Forbes.

Bakhurst says he read Tierney-Keogh’s account, in which she described the timeframes involved as “bonkers”.

“It doesn’t make pretty reading at all. If that was the way the show was being run, it is another contributory factor to why it failed,” he says.

“I was quite surprised to read that it was so chaotic,” he adds of the creative process.

He says RTÉ has a statutory obligation to pursue commercial opportunities, but “we don’t get paid to do what the market does brilliantly on its own, in my view”. Would it do anything similar to Toy Show the Musical again? There would be “a high threshold for anything on that kind of scale”, he indicates – it won’t be happening during his tenure, at least.

Fianna Fáil TD Mattie McGrath asks why on earth RTÉ has reappointed Deloitte as its auditor.

He asks if Bakhurst feels “betrayed” by former executives and board members who have declined to attend the committee.

Anne O’Leary said it was Deloitte who brought the barter account payments to her attention and recommended she hire another company to investigate it, which she did. She later adds that Deloitte “did its job”.

Nevertheless, she says that RTÉ will be looking for a new auditor when Deloitte’s current term ends and it will be going out to tender. As this process typically takes six to eight months, it was too close to the end of the last contract to begin it then.

“Yes, I do feel betrayed,” O’Leary says in answer to McGrath’s question about her former colleagues.

Bakhurst says McGrath is “not being fair” to Deloitte. “It is not a cosy cartel,” he says, in response to McGrath’s suggestion that it is.

“Who are you loyal to?” McGrath says, repeating the question that was notoriously misheard as “who are you lying to?” by RTÉ executives at one of the first Oireachtas showdowns last summer.

Fianna Fáil Senator Malcolm Byrne is next. He asks if there are any other scandals lying in wait.

“There’s nothing else, Senator, that I’m aware of. I can’t give a categorical guarantee,” says Bakhurst.

“I sincerely hope there’s nothing else. I’m not aware of anything.”

In response to another question from Byrne, Bakhurst notes that RTÉ has a contingency of €15 million in place to cover its liabilities in the bogus self-employment saga.

Byrne returns to the handling of Breda O’Keeffe’s exit from RTÉ under a voluntary exit scheme.

“It is concerning to me the way that Breda’s package was agreed. I have absolute sympathy for the staff who are outraged about it because I am fairly outraged myself,” says Bakhurst.

Highlighting significant legal opposition to the McCann FitzGerald report, he reveals that he received a solicitor’s letter on behalf of O’Keeffe yesterday suggesting he say certain things to the committee. His response was that she was welcome to attend the committee herself.

Imelda Munster turns to the subject of Toy Show the Musical.

Anne O’Leary, chair of the audit and risk committee (Arc) and a board member, says she asked for the musical to be brought to Arc for consideration, but that it was not.

She says she sought financial information and risk analysis on the project at the “combo” meeting in late March but that – as the Grant Thornton report stated – no such information was provided until May.

O’Leary says that one of her concerns was the venue and that she suggested something Gaeity-sized would have been more appropriate.

She says that Arc has a rigorous risk procedure in place and alleges that Dee Forbes and Rory Coveney “deliberately circumvented that procedure”.

Sinn Féin media spokeswoman Imelda Munster is next up. She asks Eimear Cusack about her role in the agreement for Breda O’Keeffe to leave under the redundancy scheme.

“I had no reason not to trust her,” says Cusack of Dee Forbes, who instructed her to issue the formal offer letter to O’Keeffe, and notes that she had only just joined RTÉ at the time.

Munster grills Cusack on why she didn’t flag her concerns about O’Keeffe’s participation in the redundancy scheme.

“Were you afraid to question Dee Forbes?”

“I wasn’t afraid of Dee Forbes,” says Cusack.

“That means that you just didn’t do your job,” suggests Munster, and asks Bakhurst what he thinks.

“I’ve spoken to Eimear about this a lot. I think Eimear recognises that she did question it, she probably should have questioned it a bit more,” he says.

“I think Eimear recognises that it shouldn’t have happened.”

He observes that this was how RTÉ was run in a “siloed way”, with decisions not being brought to the RTÉ executive board.

Munster says this is all fine and dandy, but that there was an expectation that none of this would be brought into the public light. She says that the public see RTÉ executives not speaking up when they have concerns and yet still remaining in their positions at RTÉ.

Bakhurst says Cusack “made a mistake”, but is “an extremely good head of HR”.

Each committee member has 10 minutes and we are starting with Brendan Griffin, Fine Gael TD, who asks whether the problems with Toy Show the Musical were “brushed under the carpet” in the months after the stage slow flopped.

Ní Raghallaigh answers that RTÉ “did not have the full facts or the full figures” in early 2023.

Griffin asks if anyone asked about ticket sales between their initial sale in May and the opening of the show.

Daire Hickey, a board member, says that he asked former director of strategy Rory Coveney about ticket sales on three occasions and also asked for a weekly breakdown of the figures, as noted in the McCann FitzGerald report. As late as October 28th, 2022, former CFO Richard Collins indicated that there would be a €300,000 profit, says Hickey.

Griffin asks if there will be further live events. RTÉ executive Adrian Lynch answers that the broadcaster has a track record of doing live events, such as performances by the RTÉ Concert Orchestra, but there will be nothing on the scale of Toy Show the Musical.

Griffin asks who decided to pull advertisements for licence fee sales and renewals last summer, which he calls an “unbelievable decision”. Kevin Bakhurst says he took that decision. RTÉ thought it would be “tone deaf” and “disrespectful” to use licence fee payers’ money to chase licence fee renewals at this point.

The message was pivoted to “thank you to paying the licence fee”, says Bakhurst.

There is the first flaring of tensions as the director general denies Griffin’s suggestion that there was a strategy to “let it burn” on the licence fee. Griffin insists that it was an “extraordinary decision at a time when your revenues were going down the drain”.

He has more questions, but chairwoman Niamh Smyth tells him he is “way over the time”.

Eimear Cusack is giving her opening statement to the committee. She says the type of “single line approval” seen in the O’Keeffe case could not happen now under new procedures. The former CFO received a letter including the wording that her exit was “as approved by the executive board”, but this was an “administrative oversight”, for which Cusack says she takes full responsibility.

She tells the committee that for a small number of individuals who took part in the scheme, questions arise as to whether departures met the legal threshold to qualify for a tax-free statutory redundancy payment.

“RTÉ will engage in a process with the Revenue Commissioners in this regard. If it is determined that errors were made in this regard, they were made in good faith and I take ownership of them.”

On the issue of so-called bogus self-employment, she says she initiated a range of processes designed to address the issue of workers engaged as sole traders rather than employees. The broadcaster is continuing to engage with the Department of Social Protection, which is investigating the issue of PRSI classifications.

“It is our hope that we can bring this process to a resolution as soon as possible.”

Kevin Bakhurst is giving his opening statement to the committee:

“These investigations have created the clarity we need to put in place the root-and-branch governance reforms necessary to ensure these mistakes cannot happen again,” he says.

He pays tribute to the work of the Oireachtas media committee and the Public Accounts Committee “in probing important issues of expenditure, governance and professional standards” and notes that the matters at the heart of the McCann FitzGerald report on redundancy payments “may not have come to light without you”.

This is a reference to the fact that Breda O’Keeffe, at her only appearance at an Oireachtas committee, volunteered that she had availed of a redundancy scheme.

“This has been a difficult and dispiriting time for RTÉ. I and my leadership team are determined to address every issue that has emerged. I know that a very different and better organisation will emerge from this crisis.

Siún Ní Raghallaigh is giving her opening statement to the committee. She takes the opportunity to again apologise for the failings of the board and gives an assurance that there can be no repeat, given the controls that have been put in place.

“The [Grant Thornton] report confirms a significant lapse in oversight of Toy Show the Musical,” she says.

“The report clearly illustrates that the board was not kept appropriately informed about the project as it was being developed. Information was withheld from the board. Significant contracts were committed to without the knowledge or approval of the full board.”

Despite the withholding of information by RTÉ executives, the board acknowledges that it should have asked more questions, she adds, and it takes “collective responsibility” for its role in the debacle.

She also notes that the ongoing funding of RTÉ remains a concern to the board.

Jack Horgan-Jones has a copy of the opening statement supplied to the committee by RTÉ director of human resources Eimear Cusack.

Cusack will say that a “separate and confidential arrangement” was struck between former director general Dee Forbes and former chief financial officer Breda O’Keeffe about the latter’s participation in the 2017 voluntary exit scheme. She will tell the committee that the agreement was made “without going through the normal VEP [voluntary exit programme] approval process” and that she was “not party to this decision nor the discussions around it”.

As outlined in a report on the scheme undertaken by McCann FitzGerald, she will say that she queried the matter with Forbes and was “assured that the required savings would be achieved”. She will say that she took the instruction from Forbes, “the ultimate decision-maker” in RTÉ, “in good faith”.

The McCann FitzGerald review found that the exit package was not brought before the executive board of the broadcaster for approval and as a result the terms of the exit scheme “were not complied with” in O’Keeffe’s case – it said the fault for this lay with RTÉ and Forbes, rather than O’Keeffe.

Who has declined to attend?

• Dee Forbes, former director general
• Moya Doherty, former chair of the RTÉ board
• Breda O’Keeffe, former chief financial officer
• Rory Coveney, former director of strategy, a key figure in the Grant Thornton musical report
• Geraldine O’Leary, former commercial director
• Jim Jennings, director of content, who is on sick leave
• Richard Collins, former chief financial officer
• Connor Murphy, former board member

Who will be attending from RTÉ today?

• Kevin Bakhurst, director general since July 2023
• Siún Ní Raghallaigh, chair of the RTÉ board since November 2022
• Adrian Lynch, director of audience, channels of marketing
• Eimear Cusack, director of human resources, a key figure in the McCann FitzGerald report
• Anne O’Leary, board member and chair of its audit and risk committee (Arc)
• Dr PJ Mathews, board member
• Aideen Howard, board member
• Daire Hickey, board member
• Jonathan Ruane, board member
• Susan Ahern, board member
• Former board member Ian Kehoe, whose term came to an end in October 2023, was listed as attending, but is not present.

Welcome this St Valentine’s Day to an arena in which no love has been lost of late: the Oireachtas media committee’s investigations into the “transparency of RTÉ's expenditure of public funds, governance issues and the future funding challenges facing RTÉ (resumed)”, as the full title goes.

Some potential lines of questioning today:

• Three board members – Ian Kehoe (whose term has since finished), Daire Hickey and Anne O’Leary – described a presentation on Toy Show the Musical at the ad hoc “combo” meeting in March 2022 as a “fait accompli”. Do they disagree with former chairwoman Moya Doherty’s position that approval was given by consensus at an April meeting of the board?
• Why did the presentation on Toy Show the Musical to RTÉ management in March 2022 show a plan for 44 shows, pointing to an 80 per cent sales rate to break even, only for the presentation to the combo meeting a few weeks later to specify 54 shows, requiring a 70 per cent break-even rate? Why did only 35 shows then go on sale? Was RTÉ ever intending to put 54 shows on sale or was this something that was said to make the project seem less risky?
• On the redundancy payments report, why did Eimear Cusack, director of human resources at RTÉ, issue a formal offer letter of redundancy to former chief financial officer Breda O’Keeffe on the instruction of Dee Forbes, but only after she asked Forbes how cost savings could be made and whether it would be “a good idea” for O’Keeffe to leave under the scheme?

On this human resources note, here is my recent column on why RTÉ's handling of its 2017 and 2021 voluntary redundancy schemes has become a key component to low morale among staff at the broadcaster:

[ Parallel universe haunts RTÉ as its North Star remains elusive for a reason ]