The Minister for Communications, Energy and Natural Resources, Pat Rabbitte, has published proposals to replace the current television licence fee with a public service broadcasting charge which will apply to every household.
The new charge will come into effect on 1st January 2015 but will not exceed the current television licence fee of €160.
However, the Minister will also be bringing forward new legislation to revise governance arrangements for the amount of advertising that all broadcasters - public and commercial - are allowed to broadcast.
This could involve a cap on the number of minutes of advertising per hour which public service broadcasters are allowed to transmit.
The Minister will be commencing a public consultation process on how the new public service broadcasting charge will be applied and collected.
Mr Rabitte is also establishing a review into the scope for further efficiencies in RTE - including its performing groups model and how it delivers Irish Language Radio Services.
The government acknowledges that RTE has already delivered savings of €104 million since 2008, and has reduced staff numbers by 21%.
It also notes that RTE has seen a 35% fall in commercial income between 2008 and 2012.
It points out that RTE is currently getting 46% of funding from commercial sources, reflecting a substantial shift towards reliance on public funds.
The government also wants RTE to improve its procedures for separating public and commercial activities and the allocation of costs.
It notes the recommendation of the Broadcasting Authority of Ireland that public service broadcasting should continue to be sufficiently well funded.
The government is also commissioning an economic assessment of the advertising market in Ireland.