The telecoms regulator reported a €10 million operating surplus for the year to the end of June 2001 on net income of €25.3 million, its latest annual report shows.
The surplus, which was raised from the levies, licence fees and spectrum income paid by communications firms in the Republic, represents a big fall on the 2000 surplus of €30.4 million.
The surplus funds in both years have been paid to the Exchequer, netting the Government €40 million.
The scale of the surplus provoked criticism from the telecoms industry yesterday. The Association of Licensed Telecoms Operators (ALTO), an industry lobby group, accused the Government of taxing companies by the back door at a time of financial difficulty for the sector.
Mr Iarla Flynn, chairman of the association, said the Department of Finance had identified the levies as an additional source of income for the Exchequer. Instead, this money should be returned to communications companies, he said.
However, a spokeswoman for the regulator said the fees were not excessive and were required by the office to cover its costs.
The report of the regulator, Ms Etain Doyle, shows the office generated €25.3 million income in the year to the end of June 2001, a fall of €21 million on the same period a year earlier.
A levy on telecoms firms for administration purposes raised €5.8 million, a levy on cable firms added €3.7 million and radio communications licensing generated €11.7 million income, the report shows.
Ms Doyle's office also made €2 million in bank interest. This was generated on the deposit of the €46.4 million that the office generated in the previous year. A postal administration levy raised €254,000, according to the report.
The dip in gross income from €46 million in 2000 to €25.3 million in 2001 was mostly due to the paltry €1.5 million generated from spectrum fees in the year to the end of June 2001.
During the previous year, the regulator netted €27 million, mostly from the sale of spectrum to mobile phone firm Meteor.
The office spent €14.7 million during the period, with the biggest expense, some €6.7 million, paid for technical advice, a sum that almost matches the figure for 2000.
Employee costs were €5 million, up from €3.9 million in the previous year.
Ms Doyle also spent €187,000 on legal fees and €533,000 on subscriptions to international bodies, the report says.
Departing from the standard practice over the past few years, Ms Doyle does not give an exact breakdown on the amount of cash set aside for liabilities arising out of legal challenges to her decisions.
In her previous annual report, Ms Doyle said she had made a provision of £2.37 million (€3 million) for legal actions taken against the office, a slight drop on the £3.09 million figure for 1999.
Eircom recently dropped several high-profile legal actions taken against the telecoms regulator, but An Post recently started a High Court challenge to the proposed €2.5 million levy charged by the office to the firm.
Directors of An Post sanctioned the legal action in late 2001 as they thought the charge, which is levied by Ms Doyle for regulating the postal sector, was excessive. It is believed this case is continuing.
Meanwhile, cable firm NTL said the high levy on cable companies compared to telecoms firms - some 3.5 per cent of turnover against 0.2 per cent for telecoms firms - put it at a competitive disadvantage to satellite firm Sky, which does not pay any levy.
