ESB worker directors refuse to sign accounts

Two ESB worker-directors have refused to give their approval to the company's 2004 accounts because of a dispute over the company's €511 million pension deficit.

The worker directors - believed to be Joe LaCumbre and Pat Smith - voiced concerns over the pension deficit at the most recent board meeting. They claimed the company was wrong to be paying out a large dividend to the Government at a time when the company's pension deficit needed to be addressed.

The issue of the pension shortfall is currently the subject of protracted talks between ESB management and unions.

Union representatives said yesterday the deficit could be addressed, but only if the company was prepared to foot the majority of the bill.

The pension issue previously led to a major row at board level when chairman Tadhg O'Donoghue was accused of dismissing Mr LaCumbre as deputy chairman of the company.

This occured after economist Eoin Fahy temporarily took over the chairman's position instead of Mr LaCumbre.

The row was later defused by Minister for Communications Noel Dempsey who said: "Joe LaCumbre is the deputy chairman of ESB and will remain so."

The position of worker directors has been the subject of some tension within ESB. Mr LaCumbre was appointed to the position of deputy chairman by ministerial letter and while staff regard the position as giving them a key influence, some senior ESB figures are not supportive of the idea.

The company will this year pay out a record €77.4 million to the Government in dividends. Some union represenatives have suggested the company should take what is known as a "dividend holiday" until the pension fund returns to a surplus position.

At the recent board meeting, chaired by Tadhg O'Donoghue, members were asked to approve the annual report and accounts, but the two worker-directors declined and their reservations were recorded instead.

However the majority of the board approved the report and accounts and they were then passed to the Government for formal approval.

The company planned to hold a press conference announcing the figures yesterday, but the Minister for Communications, Noel Dempsey, claims the company did not follow proper procedures and his department yesterday refused to allow ESB to release the report.

While the annual report and accounts were discussed by Cabinet earlier this week, certain paperwork was not sent to the ESB allowing the company to release the figures which are now over six months old.

Yesterday a source from the Department simply said proper procedures needed to be followed.

The ESB itself has refused to comment on the delay in releasing the figures. A company spokesman also said it was long-standing policy not to comment on what takes place at board level.