Bruton says Irish Water bonuses ‘a matter for the board’

Minister for Jobs reiterates view that bonus payments should not be paid to semi-state

Minister for Jobs, Enterprise and Innovation, Richard Bruton (centre),  at the launch of the Report of the Entrepreneurship Forum  today. Photograph: Colm Mahady/Fennells

Minister for Jobs, Enterprise and Innovation, Richard Bruton (centre), at the launch of the Report of the Entrepreneurship Forum today. Photograph: Colm Mahady/Fennells

Fri, Jan 24, 2014, 13:29

Minister for Jobs Richard Bruton has re-iterated the government view that bonus should not be paid to senior management in Irish Water but said the decision was ultimately a matter for the board of the new semi-state.

Mr Bruton said that the Government had a clear view on the payment of bonuses to staff in semi-state companies in the current climate and that was that there was no justification for such payments given Ireland’s fiscal situation.

“The big picture here is that the Irish Government is setting up a system to manage a hugely valuable resource in Irish water. We need to make sure that it is done efficiently and effectively in the best possible way.

“Clearly, the Government has indicated that our view for all of our commercial State bodies - this is not a period where bonuses should be paid. However, the responsibility lies with boards and they have their authority under legislation.

“It is they who must decide these issues. But the Government’s view is clear ... clearly this is a matter for the boards…the Minister for Public Reform has written to all the boards regarding what is the Government’s desired approach.

“Ultimately, boards are responsible for delivering on the basis of legislation. They must be accountable for whatever they do,” said Mr Bruton when asked about the issue when officially opening Biomarin’s pharmaceutical plant in Ringaskiddy in Co Cork.

However Mr Bruton’s Cabinet colleague, Minister for Agriculture and Fisheries, Simon Coveney said that he had no particular issue with the payment of limited bonuses to management at Irish Water given the enormity of the challenges facing the company.

“This is a company that is being set up to do an enormous job. It is the newest semi-State in Ireland and it will have an income stream of €1bn a year. It is there to dramatically change and improve and get better value for money in terms of how we deliver water.

“It will provide a much better service for both households and businesses. That is a huge job and I think it makes sense within that, when you are setting up the company, that you put incentives in place that targets set for management are met.

Mr Coveney stressed that the bonus system in place in Irish Water was a limited one and he pointed out that it was all being done as part of a transparent process which was open to public scrutiny.

“When we set up a company and put people in charge of setting up that company we have to trust them to do their job .... this is about getting performance from a new company so that they can deliver the value for money that they are being asked to deliver as soon as possible.”

“If there is a limited bonus regime as part of that, then I think that is something that is potentially worth supporting,” said Mr Coveney, adding that he wasn’t surprised that some 29 employees of Irish Water were in receipt of salaries in excess of €100,000.

“If you look across local authorities in Ireland, there are 34 local authorities all providing water services…all with senior management on significant salaries because they are doing significant jobs,” he said.

“Irish Water is a very large company and, if you look at some of the other semi-states…you will see people that have a lot of responsibility will have a salary that goes with that. I am not overly surprised by that.”