RTÉ strategy on Tubridy’s pay was bound up with station’s wider financial woes, Grant Thornton report shows

Ryan Tubridy’s agent Noel Kelly was told during a meeting with RTÉ in October 2019 that the presenter could not be paid an exit fee of €120,000 when the national broadcaster was seeking cutbacks from other staff, according to the latest Grant Thornton report.

The meeting was held to discuss a new five-year contract for Tubridy and was attended by Kelly; the then chief financial officer of RTÉ, Breda O’Keeffe; Tubridy’s solicitor Joe O’Malley; a member of Kelly’s staff at NK Management; and a person from RTÉ described in the report as Person 3.

Tubridy’s contract at the time of the meeting, which had been agreed in 2015, included an “exit fee” of €120,000 for the presenter at the end of the contract period.

Forensic accountant Paul Jacobs of Grant Thornton interviewed Person 3 about the meeting and an extract from the interview is included in his report.

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“When we went into those negotiations we said, look, we are not in a position to pay you the exit fee because we don’t have the money and we are going to publish earnings [for the station’s top highest paid presenters] and we don’t want to put in those earnings that you have earned a huge amount of money when we’re trying to reduce what’s paid to everybody else,” Person 3 said.

Additional services

The 2015 contract included provisions whereby Tubridy might provide services to RTÉ over and above his radio show and The Late Late Show duties, though these additional services were subject to negotiation. At the time of the 2019 negotiations the station sought to use the fact that no additional services had been provided to secure a reduction in the amount it was paying the presenter.

Person 3 said that at the October meeting, RTÉ said “you know that you were contracted to provide certain services for us; we didn’t call upon you to provide those services. So, it was a negotiation essentially asking him not to look for the exit fee because, as we felt, he had underdelivered”.

The interviewee agreed that, as RTÉ had not asked Tubridy to provide extra services, Tubridy was not obliged to refund money to the station or grant it a credit note. The additional services arrangement was on a “use it or lose it” basis from the point of view of the station.

“It was a negotiation to say look, we didn’t call upon you, and on the basis of that we’re asking you not to invoice for the exit fee. So it’s a gesture of goodwill,” Person 3 said.

According to the Jacobs report, Tubridy was not directly involved in the negotiations over his contract and did not attend any of the negotiation meetings.

[ Tubridy and Bakhurst: What caused the breakdown of trust in RTÉ talks? ]

In a meeting in January 2020 with Kelly, according to Person 3, the agent said he wanted the €120,000 exit fee due under the expiring contract to be added to the new five-year contract then under discussion. Kelly, according to the report, was told “that the exit fee had already been factored into the revised offer” then being made. Spreadsheets published in the Jacobs report suggest that at one stage the €120,000 exit fee was to be incorporated into the annual fee to be paid to Tubridy in the 2020-2025 period (ie at €24,000 per year) and that a new, reduced exit fee would also be factored in to the annual payments.

A core issue in the Jacobs report is how RTÉ came to ‘recoup’ or set off fees that had already been paid to Tubridy under his old contract, because of the ‘non-delivery’ of additional services during the 2015-2020 period

In email discussions in February 2020, Kelly suggests a “sign-off fee” at the end of the five-year period of €75,000 but RTÉ said it “no longer pays exit fees as they are problematic for us”.

In her discussions with Jacobs, O’Keeffe said one of RTÉ's objectives in the negotiations was to get Tubridy to waive the €120,000 exit fee.

“The reasons we wanted that is exit fees in all contracts were a difficulty,” she said. “You know, they’re a lumpy payment. We didn’t want them in there.”

A core issue in the Jacobs report is how RTÉ came to “recoup” or set off fees that had already been paid to Tubridy under his old contract, because of the “non-delivery” of additional services during the 2015-2020 period. Under the 2015 contract Tubridy was paid €495,000 in years one and two, and €545,000 in each of the following three years. At the time RTÉ was discussing a new contract with Tubridy, it had already publicly disclosed his earnings for the calendar years 2015 and 2016.

In February 2020 O’Keeffe wrote an email to the RTÉ auditors, Deloitte, who had a role in assessing the public disclosures of the income of the highest-paid presenters that are made by the station.

Recoupment of fees

“We are in negotiations with Ryan Tubridy for the renewal of his presenting services, and one aspect of the negotiation deals with the recoupment of fees for 2017, 2018 and 2019 as the presenter under delivered on the services in the contract for those years,” she wrote.

“It is proposed that the recoupment is done by way of offsetting an exit fee of €120,000 which is owing in the contract against the amounts due back from the presenter for undelivery of services.”

At the time Ms O’Keeffe was preparing to leave RTÉ – she would leave at the end of March 2020 – and was being replaced by Richard Collins, who had taken up his new role in mid-January 2020. Collins also had dealings with Deloitte in relation to the RTÉ’s dealings with Tubridy.

On January 21st, 2021, RTÉ published the figures for its 10 highest-paid presenters for the years 2017, 2018 and 2019. In relation to Tubridy, the payments cited for the years were €491,667, €495,000 and €495,000. These involved reductions on the actual amounts that had been paid to Tubridy of €20,000, €50,000 and €50,000 for the three years concerned. In his report Jacobs noted that he came across no rationale for allocating the figures to the particular years in the way they were done, other than the fact that the effect was to reduce Tubridy’s earnings for each of the years below the €500,000 threshold. (Tubridy had in fact earned more than half a million euro each year.)

[ Did Kevin Bakhurst make the right call in showing Ryan Tubridy the door? ]

Jacobs also queried the decision to spread the “recoupment” across three years of the contract, as against five. “It is likely that the €120,000 was allocated to only three years (2017 to 2019) because 2016 Top Talent earnings had already been published,” he said.

He also noted that in fact there was no real recoupment due, as the extra services had not been sought by RTÉ. He also noted that Kelly, on behalf of Tubridy, had objected to the RTÉ suggestion that the recoupment be set off against Tubridy’s published earnings, but been ignored.

In its responses to Jacobs, Deloitte said it relied on RTÉ for the information it was given that a credit was due for the three years concerned, because of the underprovision of services in those years.

Jacobs noted in his report that Tubridy was entitled to the €120,000 and quotes O’Malley as saying that “no accounting treatment by RTÉ can in any way imply that he was somehow the beneficiary of that sum at any stage”. The lawyer said it was “absurd” that Tubridy would agree to waive €120,000 and this would then be “set off against actual earnings he did receive in previous years. So we rejected it”.

Person 3 told Jacobs that RTÉ had no right to recoup money from Tubridy but had said to Kelly “we need to get something back here, we are haemorrhaging money”.

‘Set-offs’

Another RTÉ employee, called Person 2 in the report, emailed O’Keeffe on January 29th, 2020, and raised the issue of how it was decided that the “set-offs” would be spread €20,000, €50,000 and €50,000 over years 2017 to 2019.

“I think that as we have fully audited and disclosed to 2016, it is reasonable to begin in 2017 but we may need to think about how we support the split of the 20k and 50k. You may already have an idea, however the way it is written in the letter offers no explanation as to why it should vary.”

No explanation was provided by O’Keeffe in response to the email, according to the report. O’Keeffe told Jacobs: “I cannot recall the precise methodology by which the value of the undelivered services was allocated across the three years. However, a reasonable treatment could have been an equalisation of his earnings in the three-year period on the legitimate basis that Mr Tubridy provided the same level of service in each of the applicable years.”

In his report Jacobs noted that the director general at the time of the 2019/2020 negotiations with Tubridy, Dee Forbes, was not available for interview, for medical reasons, when he was preparing his report.

The new director general, Kevin Bakhurst, was close to agreeing a deal directly with Tubridy (Bakhurst refused to negotiate via Kelly) that would see the presenter returning to radio duties in September and also producing a podcast, in return for payment of €170,000 a year. However, that deal collapsed this week after Bakhurst reacted negatively to Tubridy issuing a statement in response to the Grant Thornton report, again raising the treatment of his earnings by the national broadcaster.