Archive for April 14th, 2013

It is infuriating that secret communications in 2010 on the eve of Ireland’s bailout from the IMF, ECB and EU which were closely guarded back then and whose disclosure in response to Freedom of Information requests has been strongly resisted, are now dropped into conversations as if they were everyday and mundane. We learned during the week that the IMF mission chief to Ireland in 2010, Ashoka Mody outlined three options for Ireland in 2010 – burning bondholders, extending our debt or getting lower interest rates or austerity and the last Government plumped for austerity.


Today, on RTE Radio’s This Week programme, Fianna Fail’s TD Billy Kelleher (pictured above) who was a junior minister for trade and commerce between 2009 and when FF lost the February 2011 election, blithely commented that back in 2010 the ECB threatened Ireland that if we didn’t enter a bailout programme, then the ECB would withdraw €100bn of lending to our banks. The podcast of the programme should be available in a couple of hours, but there is little to add, and the former junior minister wasn’t challenged about the remarks by the presenter or by the Fine Gael deputy, Paschal Donohoe.

What the former minister stated in a matter-of-fact manner has always been suspected, but the best we could get from current finance minister Michael Noonan was that “a nod is as good as a wink to a blind horse” but even Minister Noonan has been careful to say Ireland was never threatened – “No, no there’s no threat and they never threaten” is what Minister Noonan said in June 2011. Even the plain-speaking and preemptive governor of the Central Bank of Ireland, Patrick Honohan would only refer to the “influence” of the ECB – no suggestion of any threat from Governor Honohan either. Even the Dan O’Brien “the Bailout Boys go to Dublin”, the 28-minute radio programme for BBC Radio 4 available here from Youtube, doesn’t capture the explicit threat by the ECB and indeed the ECB representative to Ireland’s bailout Klaus Masuch, whom Vincent Browne monstered at that Troika news conference last year, asserts it was Ireland that made the bailout choice and there was no pressure from the ECB.

Now we have a minister telling us the ECB threatened to withdraw funding to our banks if we didn’t enter a bailout, which has subsequently seen 10s of billions shoveled into banks and paid to bondholders. Because Deputy Kelleher wasn’t pressed, we don’t know the nature of the threat and how it was treated.


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The important news is that Irish Bank Resolution Corporation is nearing its 6-week window which it was giving its large borrowers to refinance their loans, and developer and businessman Paddy McKillen is reported to be amongst IBRC’s largest borrowers with personal loans, variously reported at €300-370m and corporate loans reported at €550m. But all that horsetrading is taking place behind closed doors, though after recent injunctions and freedom of information requests, the participants on the IBRC side know that their actions will be closely scrutinized for probity.

So, it really is just flim-flam to re-report Paddy’s attendance at a New York society event this week where his pal and business associate Bono – seen here at the party, looking pissed (in an American sense) -was paying tribute to a Dublin artist Sean Scully who has one exhibition on the go at the moment and is opening a new exhibition of his work in New York shortly.

The 400 guests at the event included Michael Stipe of R.E.M.- fame, and our own Paddy, who Bloomberg reported, donated wines for the evening from his Chateau La Coste in France. Other guests included Eric Rudin of Rudin Capital Management. We’re all still wondering where Paddy found the readies to fund a rights issue at Coroin last year, and given the judge in Paddy’s High Court action didn’t seem very impressed with the adequacy of Paddy’s access to finance to buy Derek Quinlan’s shares, we’re left scratching our heads wondering how Paddy came up with €65m equivalent in December 2012 to meet his allotment under the rights issue and defeat a clear attempt by the Barclay brothers to dilute him.

Paddy’s vineyard at Chateau La Coste near Aix-en-Provence is part of a 600-acre development dubbed “Xanadu” which features architecture and sculpture on a sublime scale, including sculptures by moonlighting REM-frontman Michael Stipe.

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“For every €160 in licence fee we received from you in 2011, not only did we spend all that but we ran up an extra €61 in losses which we are funding with bank loans” The RTE promotional advertisement that you’re unlikely to hear, but with total losses of €69.7m in 2011 after receiving €183.6m in licence fee income, RTE spent ALL the licence fee and ran up losses equivalent to €61 for each of the 1,148,000 homes that paid €160

“Today, tomorrow, together” reads the strapline to a new RTE self-promotion advertisement launched in the same week as an “independent” PwC report into RTE’s finances was published, which concluded that against all odds, with vertiginous declines in domestic revenue and with shoe-string budgets compared to TV companies in other (bigger) markets, RTE is still the most trusted media outlet, or at least it was in 2009 which appears to be the most recent research into the matter! Add in the RTE Director General’s claim that presenters face 40% salary reductions- though old media reporting omitted the rider that their salaries have already been reduced by 30% so the additional reduction is just 10% – and we appear to have something worthy of the Moscow rules : once is chance, twice is happenstance and thrice is enemy action.

And the “enemy action” in this case is the imminent release of RTE’s financial results for 2012. The old media has been talking for a couple of months about what it calls a “deficit” of €50m for 2012. But the old media ignores losses in the RTE pension fund, and unlike Aer Lingus, if there’s a deficit in RTE’s pension fund, ultimately you and I pay for it. In 2011, that pension fund loss was €49.7m, it is not likely to have gotten better in 2012! Remember RTE had revenues of €350.9m in 2011 comprising licence fee income of €183.6m and commercial revenue of €167.3m. Here is the comprehensive statement of loss for 2011 – the old media will focus on the deficit of €16.8m but the truth is RTE ran up losses that total €70m

So, it would appear we are being softened up ahead of the release of the worst financial results in RTE’s history.  These will contrast with TV3 which lost €6.8m in 2011 and TG4 which recorded a total recognized gain of €109,000 in 2011 and UTV which recorded a total recognized gain of GBP 2.998m for the first six months of 2012.


Maybe Richard Curran, brother of the RTE director general – pictured above – might do a special investigation on the putrid mismanagement of an organization TODAY, not 5-10 years ago as was his archaeological piece on Irish Nationwide recently. If we want a pantomime villain, we don’t need to hear about golf balls and stays at the Dorchester half a decade ago. We have a presenter in a broadcasting company being paid €630,000 per annum, RIGHT NOW.

RTE was supposed to have produced a 5-year strategy document by the end of 2012 which would show how the broadcaster was going to return to break-even. We’re still waiting but we had this flim-flam from PwC this week which boils down to “RTE does a fantastic job with limited resources”. Meanwhile these are the recently released presenter salaries which are misleading for 2012 as they don’t refer to final earnings.


It seems that RTE has become a disaster zone, with libels and incompetence overseen by incapable management, and this is reflected in that organisation’s financial results. RTE still employs nearly 2,000 people and supports jobs and industry across independent producers and suppliers; it is a major business. But the time has come to call a halt to delusional management that is sinking the organization deeper into a quagmire which will ultimately need to be bailed out by the State. And Noel Curran is fobbing us off with flying a kite about a reduction in 65-year old Pat Kenny’s salary from €630,000 to €570,000?!

And finally, just to really put you in a bad mood, this is the schedule of today’s programming from the UK’s Freeview service, digital free to air service (in Ireland the standard licence fee is €160 per annum, in the UK it is GBP 145.50 or €171)


And here’s Saorview on Sunday 21st April, 2013


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