RTÉ Director General Kevin Bakhurst has written to staff defending the decision to seek "philanthropy advice and grant distribution services" for the RTÉ Toy Show Appeal.
Details of the tender outlining the work involved had "gained some coverage", he said, adding that he wished to "set out the facts clearly and directly".
Mr Bakhurst said that the tender is for "an indicative period of up to five years", adding that it is a three-year contract with an option for a further two.
He said that the €855,000 figure "being cited is the cumulative estimated total across that entire period, not an annual cost, estimated to be less than €175k annually".
Mr Bakhurst went on to explain that the Toy Show appeal has to date raised over €31 million, including the most recent appeal last December and pointed out that the breakdown of figures was available in the RTÉ five-year impact report.
According to the RTÉ Director General, the €855,000 figure covers "substantial" work that "requires real professional expertise" to distribute funds of this scale.
He said that the costs involved come from the fund itself, not from RTÉ, and "that has always been the case".
"It is fully disclosed in an annual impact report each year," he said.
The RTÉ Director General stated that across the first five years of the appeal, 96.7% of all funds raised went to frontline children's charities.
"The 3.3% allocated to operating costs over that period is significantly below sector norms. That's not an accident," he added, but due to "rigour".
He defended the governance of the appeal fund, stating that it has been run with "transparency, accountability and maximum efficiency" and that the "five-year record bears that out".
He concluded by saying that "the generosity of the Irish public has changed lives."
The details of the tender have come under scrutiny in recent days, with Social Democrats TD Aidan Farrelly, who is a member of the Public Accounts Committee, requesting that the committee discuss the issue.
Read more: RTÉ to spend €855,000 over the next five years to distribute Toy Show donations
