Public pay review to be confined to senior posts

Fri, Apr 22, 2011, 01:00

THE GOVERNMENT’S plan to assess pay levels in the public sector will be confined to those in senior positions.

The Department of Finance said yesterday that general pay levels for staff in commercial semi-State companies would not be covered by the review proposed by the Minister for Public Expenditure and Reform Brendan Howlin.

On Wednesday the report of the review group on State assets recommended that a comparison should be undertaken of pay and conditions in all commercial State companies with those elsewhere in the Irish labour market and in competitor countries, in particular in the UK, to assure that cost structures were competitive with their counterparts.

Speaking after the launch of the report, Mr Howlin confirmed that the Government would undertake a review of pay. However the Department of Finance said yesterday this would be restricted to those at the top level.

The recommendation contained in the review group report contained no such restriction and it appeared to indicate that all pay levels should be covered by any comparative analysis.

In a statement yesterday a spokeswoman for the Department of Finance said: “The Minister for Public Expenditure and Reform will give further consideration as to how best to effect reductions in the remuneration of senior public sector posts, including CEOs of commercial State companies, while acknowledging that there may be contractual issues in relation to the application of any cap to current incumbents and to bring proposals on the matter to Government shortly.”

Mr Howlin said on Wednesday that the public would be “shocked or surprised” at the terms and conditions of some at the top level in the semi-State sector.

The review group report showed that the chief executive of the ESB received a financial package of more than €752,000 in 2009, while those at the Dublin Airport Authority and An Post received more than €500,000 each.

The average earnings for each employee in the Irish Aviation Authority in December 2009 was €95,600. This figure increased to €120,300 when pension contributions were included.

In Eirgrid the average salary per employee in September 2009 stood at €83,400, which increased to €96,900 when pension contributions were taken into account.

In the ESB in December 2009 the average earnings per employee was €75,000. However when pension contributions were included this figure increased to €94,300.

The Irish Small and Medium Enterprises Association (Isme) yesterday called for immediate action to address what it described as “the scandalous and crazy level of pay and benefits in the semi-State companies” outlined in the report.

It said it was “bordering on criminal” that average salaries with benefits in excess of €94,000 in the ESB, for example, were allowed when private sector unemployment had reached 450,000 and businesses and their employees in the private sector were struggling to make ends meet.

Isme chief executive Mark Fielding said: “It is absolutely disgraceful that the boards of these semi-States, populated in the main by political cronies, aided and abetted by worker directors, have ‘screwed’ the taxpayer by constantly awarding the cosseted workers in the semi-States exorbitant salaries way out of line with the rest of the economy.

“The lack of appropriate board expertise and fear of taking on the public sector unions has resulted in the taxpayer paying a premium for wages beyond what can be afforded.”