TV licence fee to get €3 hike
The Television Licence Fee is to increase by €3 to €158 from October 1 this year, it was announced today.
Communications Minister Noel Dempsey said the Government agreed to the price hike in order to provide RTE with money to improve its output.
“Having regard to all of the circumstances it is considered that there is a strong case for approving an increase in the level of the television licence fee,” he said.
“The principal reason for this is that it will provide RTE with the means to further strengthen the schedules it delivers the audience in circumstances where Indecon have reported that RTE is providing value for money.”
RTE submitted a Corporate Plan for 2006-2010 to the Government in March 2006, which was one of the conditions of the last licence fee increase in April 2005.
An independent review of RTE’s performance in 2005 was undertaken by Indecon Consultants, which found it had performed well in delivering on its output, financial and change management commitments.
Indecon reported that the broadcaster has broadly succeeded in fulfilling its corporate and financial commitments and met or exceeded its output commitments on television, radio, publishing and performing groups.
In considering the level of increase that might be approved, the Department of Communications, Marine and Natural Resources suggested that an increase of less than Consumer Price Index (CPI) should apply.
The annual rate of CPI in the year to April 2006 was 3.8%, which would equate to an increase in the cost of a licence fee of almost €6.
Having regard to the conclusions of the Indecon report, coupled with the significant increase in other revenue projected, the department proposed that the cost of a licence fee would be increased by €3 with effect from October 1.
This increase will provide RTE with an estimated increase in public funding of just under €2m in 2006.
It is also estimated that RTE will benefit from an increase in public funding of around €6mo from a combination of new household growth and a reduction in the level of evasion.
The incrase was recommended subject to the following conditions:
:: That within one month of the decision RTE would bring forward proposals, based on the Indecon recommendations, as to the steps that it will take in 2006 to ensure it can provide a greater assurance that it is meeting its commitments to the public and providing value for money in doing so.
:: That RTE will engage as required with the Department in relation to the agreement and publication of its strategic corporate plan.
