Century Radio dismissed RTE's estimate for transmitting its service as ridiculous and threatened to bring the matter directly to the Minister for Communications, Mr Burke, the Flood tribunal has heard.
RTE's finance director, Mr Gerry O'Brien, said he met a "total blanket refusal to engage with us at all" in meetings with Century's co-founders, Mr Oliver Barry and Mr James Stafford in 1988.
At one meeting, Mr Stafford said, "We'll see what the minister says about it," Mr O'Brien told the tribunal yesterday.
RTE initially proposed a fee of £1.14 million for transmitting Century's signal but dropped its demand to over £600,000 following an intervention by Mr Burke. The fee was reduced further to under £400,000 by directive of the Minister in March 1989.
The witness yesterday described his meetings with Mr Barry and Mr Stafford as "very frustrating".
"We set out our figures, we were ready to be attacked on them and to enter into heavy negotiations. But instead the tendency was to dismiss the figures."
There were no negotiations on the figures, and no analysis of the RTE estimate was carried out, he said. RTE last met Century on November 18th, 1988, a month before Century lodged its application for the national radio licence.
Mr O'Brien said he was surprised by Mr Stafford's remark. "Our general view was that Oliver Barry and James Stafford were coming at this through another source, which wasn't RTE. We thought they were dealing with the Department of Communications."
Also yesterday, the tribunal heard evidence from Mr Seamus O Morain, a principal officer in the Department, on the Government's plans to cap RTE's advertising revenue and to divert some of RTE's licence fee to the commercial broadcasting sector.
Mr O Morain said the objective of capping RTE's advertising revenue was "primarily and fundamentally" to support the development of the independent broadcasting sector.
Representations made by the National Newspapers of Ireland were not a "precipitating factor" in the decision to introduce a cap, he told Ms Patricia Dillon SC, for the tribunal.
Asked by Ms Dillon whether any consideration had been given to job losses at RTE arising from the cap, Mr O Morain said this had not been considered.
The decision to divert £2 million of RTE's income annually to the Independent Radio and Television Commission for the use of commercial broadcasters was taken by Cabinet in May 1990 and unveiled by the Minister for Communications, Mr Burke, in the Dail a week later.
After Mr Burke announced the proposals, there followed, in the words of the witness, "ri-ra and ruaille-buaille".
The Minister subsequently dropped both provisions from the Broadcasting Bill.
