ESB chief defends pay levels

ESB chief executive Pat O'Doherty has said a performance improvement agreement to take 20 per cent of pay roll costs out of the system between 2011 and 2015 is 'on track'. Photograph: Bryan O'Brien

ESB chief executive Pat O'Doherty has said a performance improvement agreement to take 20 per cent of pay roll costs out of the system between 2011 and 2015 is 'on track'. Photograph: Bryan O'Brien

Tue, Mar 5, 2013, 00:00

Pay levels in the ESB have been defended by the organisation’s chief executive Pat O’Doherty following criticism from Oireachtas members attending the British-Irish Parliamentary Assembly in Donegal.

Mr O’Doherty was asked to outline efficiencies achieved by Fine Gael TD Martin Heydon, who emphasised the impact of cost of energy on small businesses.
“High wages and salaries in organisations like the ESB can be upsetting to people who are paying those costs,” Mr Heydon said.

Fianna Fáil Senator Jim Walsh also raised the issue of wages in the ESB. Mr O’Doherty said the ESB had been on a number of major transformation drives over the past decade to lower overall operation costs.

He said ESB was the first public sector organisation in the Republic to move to career average pensions thanks to a “ground-breaking” agreement with trade unions. He said a performance improvement agreement to take 20 per cent of pay roll costs out of the system between 2011 and 2015 was “on track”.

Twenty-five per cent of staff was on “market-facing” terms and conditions rather than traditional ESB semi-state sector-type terms and conditions.

In a speech to Irish and British parliamentarians, Mr O’Doherty said politicians faced a significant leadership challenge when it came to investing in energy. He said both Ireland and Britain faced binding decarbonisation targets and which would require huge investment.

“In Ireland alone, Deloitte reckons that the changes needed to transform the electricity sector will cost up to €50 billion over the next two decades. That means doubling historic levels of investment,” he said.

“Investment in long cycle energy projects can only take place in the context of long-term market and regulatory certainly. Governments and politicians must therefore look beyond short or medium horizons to develop policy frameworks that focus on the long term, while encouraging investment in the short to medium term.”

Mr O’Doherty said policy makers faced what he described as a “trilemma” of balancing three vital but often conflicting priorities: security of supply, protecting the environment and ensuring that energy prices remained affordable and competitive.

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