Irish Water chief defends bonus payments to staff

Irish Water executives have defended offering their staff performance-related bonuses in the wake of political pressure not to proceed with the payments.

John Tierney, the company’s managing director, said that even with bonus payments, which will average 10 per cent of salary, the new semi-state company will have cheaper wage costs than similar organisations.

John Barry, an Irish Water executive, said the bonuses, which are available to all staff except Mr Tierney, help motivate workers.

Their comments at a meeting last night of the Dáil Public Accounts Committee (PAC) followed statements from Minister of State for Finance Brian Hayes that the bonuses should not be made. Minister for Social Protection Joan Burton also said she was surprised contractual provision had been made for the bonuses.

Senior civil servants in the Department of the Environment said at the meeting that the Minister, Phil Hogan, was not given a detailed breakdown on consultancy spending by Irish Water.

However, Mr Tierney said the wages and pay structures offered to staff in Irish Water were based on those of Bord Gáis, which paid its staff an average bonus of €7,000 across 300 staff. He stressed that no bonuses have been paid to date, but the 299 staff recruited to Irish Water so far will be entitled to them.

He also the said Department of Communications, which has ultimate responsibility for Bord Gáis, would have been aware of the arrangements for Irish Water.

Mr Tierney said that even with the performance-related bonuses Irish Water will be a low-cost company since it does not have incremental pay scales and currently has a pay freeze in operation. He said it was “quite humbling” to work with such motivated staff. “The performance I have seen of the people in the organisation has been absolutely outstanding.”

Mr Barry said in his view “there should be a monetary bonus” if people outperform targets set for them by Irish Water. “Their talent pool is managed and they have the ability to move sideways or upwards in the organisation.”

Geraldine Tallon, the secretary general in the Department of the Environment, said Irish Water “should be as lean as possible”. But she said the contracts “reflected a contemporary economic environment”.

Ms Tallon also said the Department of the Environment always knew Irish Water would need external consultants.

The company has said it will spend €85 million on external consultants by April 2015, out of an overall budget of €180 million it needs to establish itself.