Firm being paid €90,000 per week to advise Government on banks
Published 29/09/2011 | 05:00
TOP-tier consultants McKinsey's are being paid close to €90,000 a week under a €2.75m contract to advise the Government on bank restructuring and mergers.
The sizable costs were revealed this week in an answer to a parliamentary question from Sinn Fein finance spokesman Pearse Doherty, who asked for details of McKinsey's pay and remit.
Finance Minister Michael Noonan revealed that the firm had agreed a "fixed fee, including expenses" of €2.75m for work between May 16 and December 31.
The figures imply McKinsey's are getting just over €90,000 a week from for working as an "external adviser" on the Government's bank restructuring projects.
Mr Noonan said their role was to "ensure a timely, efficient and effective process, and to review the proposals for merger and integration".
The biggest merger has been Anglo Irish Bank and Irish Nationwide, which will be known as Irish Bank Resolution Corporation, and AIB's takeover of building society EBS. Mr Noonan said McKinsey's had carried out no work "other than that specified under the terms of the [original] contract nor has it proposed to".
Industry sources say McKinsey's most expensive "partner level resources" typically cost around €3,000 a day while more junior staff can come in at about €500.
The number of staff involved in Irish banking projects varies depending on the level of activity.
The fees for McKinsey's work are to be recharged to the banks themselves, though since the banks involved are state-owned, the cost will still be ultimately borne by the State.