The co-founders of Century Radio, Mr James Stafford and Mr Oliver Barry, were "shocked" and "dumbfounded" when they learned that RTE intended to charge the new station £1.14 million for transmitting its signal, the Flood tribunal has heard.
Mr Gerry O'Brien, finance director of RTE, was describing the reaction of Mr Stafford and Mr Barry when the RTE proposal was first outlined at a meeting in November 1988. The Century cofounders rejected RTE's figure "out of hand," he told the tribunal.
Mr O'Brien said there had been "no interaction, no negotiation" at the meeting, and RTE agreed to provide Century with a more detailed breakdown of its figures.
Mr O'Brien denied there was any "padding" in RTE's figures, although he conceded there was a "margin" involved. "We didn't want to short-change ourselves," he said.
Mr O'Brien spent much of yesterday explaining the basis for RTE's £1.14 million fee. The tribunal has heard the station reduced the figure to about £600,000, which was further reduced to under £400,000 by order of the then minister for communications, Mr Ray Burke, in March 1989.
Yesterday, the witness said he had never met Mr Stafford before the November 1988 meeting, though he knew Mr Barry as a member of the RTE Authority. E transmission executives, including Mr Peter Branagan and Mr John McGrath, who were on "first name terms" with Mr Stafford and Mr Barry. But it was clear Mr Stafford and Mr Barry had been "around the system" in RTE, he said.
Century was the only one of the four bidders for the national commercial radio franchise to approach RTE for talks on sharing the transmission system, he said. In their talks with RTE, Mr Barry and Mr Stafford never offered figures of their own.
Mr O'Brien's evidence continues next Tuesday.
