RTÉ has disclosed to Minister for Arts and Media Patrick O’Donovan that it was forced to write down €3.6 million on an IT project that had to be partly abandoned.
The IT project was funded by some of the proceeds of RTÉ’s sale of lands on its Montrose campus for €107.5 million in 2017.
The broadcaster said it was designed to replace legacy finance and HR systems that were at or near the end of their life.
In a statement issued on Wednesday night, first reported by The Currency website, the broadcaster said two suppliers were appointed on foot of submitting the cheapest proposal. The broadcaster said, however, “issues arose almost immediately”, adding the suppliers did not resource the project sufficiently but also resource constraints within RTÉ contributed.
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Testing revealed the product “did not meet expectations and over-ambitious timelines”, which RTÉ said was compounded in 2020 with the outbreak of the Covid-19 pandemic. The contract was terminated with one of the appointed suppliers, which was the subject of a settlement agreement that, in turn, was the subject of a confidentiality clause.
RTÉ said it then engaged with another supplier. The project restarted in August 2022, with the finance system going live in March 2023. The broadcaster did not proceed with the HR elements of the project.
RTÉ said the majority of the impairments relate to the effort to deliver the HR part of the project, coming to some €2.3 million, while €1.3 million relates to the delayed finance elements.
In the aftermath of the controversy over spending on a failed IT system at the Arts Council, Mr O’Donovan wrote to agencies and bodies operating under the remit of his department seeking information about projects costing more than €500,000. He also sought information about capital projects below that level where there was significant expenditure but they had been abandoned or failed to deliver on their objectives.
RTÉ said the impairments were noted in its annual accounts during the years 2020-2023, but “more specific details relating to this project have been disclosed to the Minister as part of the review of capital projects”.
The project was one of 39 that fell into the category of spending of €500,000 or more. The broadcaster said that across all these projects, the overspend was worth less than €500,000 in total.
The statement from RTÉ said the impairment was “very much an exception” in the context of extensive projects it has delivered.
RTÉ has faced financial difficulties in recent times and announced last week the terms of a voluntary redundancy package intended to cut 400 jobs over coming years.
Job losses and other changes have come as part of the broadcaster’s New Direction Strategy, which Director General Kevin Bakhurst said would make the organisation “more agile”.
