With the Bus Eireann strike ending its second day, you might be interested to take a quick look at the finances of that company. It made a profit of €455,000 in 2011, the last year for which accounts are available. It has a balance sheet with net assets of €23m. The annual report and accounts for 2011 are available here. The profit and loss account and the balance sheet are shown below. Bus Eireann says there are no recognized gains or losses other than those shown in the profit and loss account.
This is an organization about which An Tanaiste Eamon Gilmore said last Thursday “Bus Éireann is in a precarious financial situation with the very viability of the company under threat”. Well, if that is the case, something shocking must have happened in 2012, but we don’t yet have the accounts for 2012. Looking at the five year revenue figures for Bus Eireann, the income from tickets looks pretty stable.
But contrast the fortunes of Bus Eireann with those of another state company, RTE. In 2011, RTE made a fully recognized loss of €70m, mostly comprising a deficit of €17m and a pension scheme loss of €50m. RTE had net assets of €68.5m at the end of 2011. We do know that RTE has been failing to maintain its commercial income which RTE blames on the recession. Here is the profit and loss, statement of comprehensive income and balance sheet:
Unlike Bus Eireann, we do have an indication of RTE’s results for 2012; it is said in press reporting to have run up a deficit of “at least €60m”, we don’t know how the pension scheme performed. But a €60m deficit will practically wipe out RTE’s balance sheet and reduce equity from €68.5m to €8.5m.
When asked about the finances of RTE, Minister for Communications, Energy and Natural Resources, Pat Rabbitte says that it’s nothing to do with him, he says concerns about RTE’s finances “are purely matters for RTÉ management. RTÉ has a direct obligation under Section 105 of the Broadcasting Act 2009 to ensure that its revenue is at the earliest possible date at least sufficient to meet all sums properly chargeable to its current account and to make suitable provisions with respect to capital expenditure. I am satisfied that RTÉ management is fully cognisant of this obligation and are taking all the necessary steps to ensure that the company continues to be in compliance with the terms of the provision.”
Contrast the Government’s stance on pay and conditions of employees at Bus Eireann versus those at RTE.
NAMA Wine Lake 
Which of these two state companies is “in a precarious financial situation with the very viability of the company under threat”
My money is on an outsider – AIB
Bus drivers are that part of the economy that must be made competitive, if ‘we’ are to emerge from the crisis.
RTE staff, on the other hand, like the politicos and other elites form that part of Irish society that must be kept in the manner to which it has become accustomed.
If the bus drivers have to put in their place in order to broadcast the established order, then that is what must be done.
RTE radio this morning was gushing over the prospect of a ‘deal’ for people earning between €65,000 and €100,000. Increments would only be deferred for 18 months rather than three years and any money lost would be paid back in 2017 or 2018. A ‘breakthrough’, was the word being used, if I recall correctly.
Increments being paid for five years now in the midst of the biggest depression since the 1930s.
Bus drivers, on the other hand, are to get it in the neck. It’s that natural order of things in Ireland. Cut shift pay, cut overtime premium, cut everything that does not extend to ‘core’ pay. The people at the top only get ‘core’ pay; big, big amounts of core pay. Can’t touch that.
Great opportunity for Varadkar to display his skills. The same Varadkar, who stopped on his way back from a Fine Gael rally at the luxurious Faithlegg House in Waterford, in order to comment on politicians expenses.
He explained that if was going into ‘town’ on a Sunday morning for an interview, he would be entitled to parking expenses. How’s that for leading the austerity charge.
John Bruton, who the Indo has dubbed ‘Fat Bishop’ Bruton, still gets hos 135,000 pension. Great stuff, this austerity.
As John B. Keane once said, ‘Men of property are fond of blaming all kinds of civic strife on men who have no property’.
RTE’s turn will come. One step at a time.
@Otto, I wonder.
Now if only the Bus Eireann staff had commissioned an “independent” report from PwC showing what a sterling job they were all doing and seeking substantial increases in fares whilst pointing out that a decade ago, Bus Eireann was more trusted than private operators, then maybe they might have avoided this unpleasantness. After all, with revenues of nearly €290m and a negligible profit, Bus Eireann might correctly say that it spent €290m in the Irish economy in 2011. Yet somehow RTE emerges as a squirrel whilst Bus Eireann is portrayed as a plain old black rat.
Maybe! But it looked like the medical consultants were doing fine until, all of a sudden, they got the largest paycuts of any public sector workers in Ireland. Every powerful unit is not tackled on the same day because of the obvious advantages of divide and conquer.
Ask not for whom the pay cut tolls, it tolls for thee (sooner or later…)
NB I hope it is clear that ordinary Bus E workers do need to take a cut. They are paid much more than their private sector equivalents, both here in Ireland and abroad. They have a very substantial “insiders premium” that does not in any way reflect e.g. the need to attract internationally mobile medical researchers to Ireland. Over a period of years, wholesale privatisation and contracting out is the way to go, for all Irish bus services.
NB2: I do enjoy your holding RTE’s feet to the fire however…
Given that our Government took the calculated decision to introduce a property tax while avoiding a wealth tax, ANY worker in this asylum would be a complete idiot to give any concession whatsoever to this rotten Government.
Its every man for himself now thanks to these incompetents.
What’s the betting on a management buyout in the offing in the very near future. This has all the whiff of a cost slimming exercise making the number look good.
Bus drivers are ordinary Irish people. They are their company are expendable.
RTE employees are members of the State Ascendancy. When it comes to their companies, Ireland is expendable.
Bus drivers can be overpaid as much as any other worker. Overpayment of low skilled staff in insider protected positions is one of the things that need to be reformed.
Reblogged this on Machholz's Blog.
@otto
Your using flawed PRE- €64 Billion bank bailout logic. The rules have changed.
Bill Gates (world’s second richest man) has been paid €27 Million euro by the Irish taxpayer because he was a senior bondholder in Anglo Irish bank in 2006.
http://www.independent.ie/business/irish/bill-gates-was-bondholder-in-bailedout-irish-zombie-banks-29226533.html
You should be thanking bus drivers (and others) who’s taxes are paying for this highly questionable transfer of debt.
The private sector bus drivers are also paying off that debt!
Without the PSO payment BE had total losses in 2010 and 2011 of €93.4m. We’re all OK with this?
@Jesper, the PSO payment is, as I understand it, compensation to Bus Eireann for operating uneconomic routes that service a social purpose. It’s akin to the licence fee that RTE gets paid. Take away the licence fee from RTE and it has made a €490m loss in 2011 and 2012 and that’s before any charge on the pension scheme in 2012.
@ NWL
I really like the spotlight on RTE. Keep up the good work. Presumably your aware of BBCs new wage structure. Specifically they have recently stated no one in the organization can get paid more that 20 times the lowest paid.
Obviously that’s a huge organization with a lot more pressure/viewers/listeners/readers. So I’d imagine some where between 5 to 10 times would be sufficent for RTE.
I’ll guess and say the lowest paid is on 20 grand. That would make the ‘Superstars’ and ‘management’ eligible for salaries in the range of 100,000 to 200,000.
Seems reasonable to me.
@John, not seen that proposal in the BBC. Have you a link?
There was a proposal by Will Hutton of the Work Foundation that no top paid civil servant should be paid more than 20 times the lowest paid but I believe even the Work Foundation isn’t promoting that any more.
http://www.guardian.co.uk/politics/2011/mar/15/will-hutton-top-civil-servants-pay
It’s policy nonsense of course, because it is often the low-paid civil servants who are paid too much for their particular labour markets and the high-skilled public service jobs that are hard to fill. Irish universities have no problem attracting administrative staff, but hiring a non-Irish senior economist from abroad ? not a chance.
on May 14, 2013 at 7:10 pm | ReplyJohn Foody
See BBC HARDtalk – Lord Patten – Former Tory MP and Chairman of the BBC Trust (2/5/13)
It mentions they have put in place a multiple cap, but it’s a ‘multiple of the Median wage’ not the lowest paid.
He does NOT mention a 20 to 1 figure though, he doesnt mention any figure. I obviously confused it with the report you mention.
Go to 8.30 minutes.
He doe mention a cap of £150,000 on severance pay.
See BBC HARDtalk – Lord Patten – Former Tory MP and Chairman of the BBC Trust (2/5/13)
http://www.youtube.com/watch?v=z2Qv7Hu2rlA&feature=youtube_gdata_player
It mentions they have put in place a multiple cap, but it’s a ‘multiple of the Median wage’ not the lowest paid.
He does NOT mention a 20 to 1 figure though, he doesnt mention any figure. I obviously confused it with the report you mention.
Go to 8.30 minutes.
He doe mention a cap of £150,000 on severance pay.
Otto = child of thatcher?