RTE recorded a deficit on its broadcasting activities again last year and expects a further deterioration in 1997.

Although, overall, the organisation showed a small surplus for 1996 this is expected to disappear this year, with RTE anticipating an annual loss of possibly £5 million.

As RTE yesterday published its interim accounts for 1996, RTE Authority chairman, Prof Farrel Corcoran, said the issue of the licence fee was one which would have to be revisited, raising the prospect of a further rise in the fee.

RTE was given a licence fee increase of £8 last year. It had been seeking £13. However, it was also given responsibility for one hour of programmes a day to TnaG.

The accounts show a deficit of £2 million in broadcasting activities, with a surplus of £4.5 million on its commercial activities.

However, the resulting surplus of £2.5 million is considered too small for the health of the organisation, given it is about to face unprecedented competition.

Yesterday, the director general, Mr Bob Collins, said that, on the face of it, RTE was financially healthy, without any major borrowings. However, there was a worrying trend in its finances and he predicted that the annual report for would show a break even position rather than a surplus.

Mr Collins said that with its commitments to the new Irish language channel, TnaG, and the independent programme making sector, RTE could face losses next year of up to £5 million.

Its commitment to independent programme makers is rising annually as well. This year it is committed to spending £8.5 million, rising to at least £12 million by 1999.

Prof Corcoran, said that pressures noted in the 1995 annual report were continuing and intensifying. "There is as yet no new source of revenue to give [the] long term support needed for production of 365 hours of television programmes for TnaG."

Revenue in RTE's principal activity of providing television and radio broadcasting within Ireland increased by £8.695 million over the previous year, due mainly to an increased in television commercial income and the increase in the licence fee. As expected, operating expenses had also increased, he said.