Cutbacks puts advertising industry 'in peril'

THE GOVERNMENT’S actions in cutting its advertising budget in half is doing “untold damage” to the advertising industry, it has been claimed.

The State spends about €64 million a year directly on advertising such as public information campaigns, tenders and public service recruitment. Semi-State agencies would bring the figure to more than €100 million.

Advertising and public relations was targeted as part of the first wave of Government cutbacks announced last summer.

The Institute of Advertising Practitioners in Ireland (IAPI) has sought a meeting with the Minister for State for Finance, Martin Mansergh, and the Minister for Enterprise, Trade and Employment, Mary Coughlan, to discuss how the Government advertises public tenders.

The IAPI said that many Government departments and local authorities waste unnecessary money in the manner in which they advertise public tenders.

They propose a centralised tendering system such as that in the UK where a number of advertising agencies are in charge of ensuring tender information is made available to the widest possible audience.

“The Civil Service have no marketing expertise and they are doing these contracts without being experts in advertising or marketing. We believe this would save the Government money,” IAPA chief executive Sean McCrave said.

The extent of Government cutbacks in advertising was revealed by the chairman of the Road Safety Authority chairman, Gay Byrne, who claimed that the Department of Finance stepped in a month ago and just “swept aside” its €3 million annual advertising budget.

"They didn't come to us and say, 'we are reducing your budget by this amount'. They specifically fingered our only means of communicating our message to the public," he said on RTÉ's Morning Irelandprogramme.

A Department of Finance spokesman said it had recommended to Government departments such as the Department of Transport that they should cut their advertising budgets in half, but it was up to every department to implement it in their own way.

Mr McCrave claimed the Government’s decision to cut back on its advertising budget amounts to a false economy as most of it would be returned to the State in VAT and tax receipts.

“The Government is by far the biggest advertiser in the State and when it cut backs it has left us in peril,” he said.

“Every euro they stopped spending, not only did they stop getting an important message out to the general public, they also forgot that they were getting it back at every level. The multiplier effect was huge,” he said.