Shatter issues warning over bailout bankers' bonuses
Published 20/04/2011 | 12:19
Justice Minister Alan Shatter has signalled bailed-out bankers may not be legally entitled to massive bonuses.
Warning he was setting down a marker, Mr Shatter said senior executives who left lenders needing taxpayer cash should not be rewarded with lucrative retirement packages.
"There is a serious issue as to whether they are in such fundamental breach of contract as to not be entitled to the rewards that they are seeking," he said.
Mr Shatter said Finance Minister Michael Noonan was examining what could be done about it.
He said it was completely unacceptable that bank bosses whose bad decisions helped bring about the destruction of the entire banking industry believed they were due enormous awards.
"Some of those who are responsible for where we now find ourselves, I think instead of demanding more money should hang their heads in shame and move on," he added.
Speaking at the Association of Garda Sergeants and Inspectors (Agsi) annual conference, Mr Shatter said he was conscious everyone was "rightly infuriated" at huge retirement packages dished out to bankers.
He said employment contracts are two-way processes, and if an employee had failed in their function - by leaving an organisation in liquidation or needing outside funding - there was a serious question over whether they had breached their contract.
Mr Shatter refused to be drawn on specific individuals in the banking industry, but said he was putting down a marker on how it was appropriate to approach the issue.
In a hard-hitting address to delegates at the conference, Mr Shatter said there could be no case made for paying bankers bonuses in the current environment.
Referring to the €3m golden handshake to former Allied Irish Bank managing director Colm Doherty, he said it "defies belief" it was paid out at a time when the lender was on public life support.
"It is long past the time for a public acknowledgement of the gross immorality of demands made for excessive retirement awards," he said.
"No one should expect Irish taxpayers to carry an ever increasing burden to facilitate retiring bank executives lead lives of unjustified luxury."
He added: "Those responsible for where we are now should be held accountable not rewarded for their scandalous failings."
Mr Shatter said while the financial compensation sought for early retirement may not be criminal, it is grossly immoral.
The Department of Finance said it does not believe there will be any further retirement windfalls to AIB's top bankers.
Officials have also been probing executives' contracts on other bank boards and Taoiseach Enda Kenny warned there may be others due a payout.
"There may well be other senior banking executives who have legal entitlements to similar kinds of deals, there may well be, I don't know," Mr Kenny said.
"The Department of Finance is now examining that situation following a request from the minister.
"We have to look at new remuneration allowances for the future."
And he hit out at former Finance Minister Brian Lenihan claiming he should have known the fine details of Mr Doherty's contract.
Sinn Fein President Gerry Adams questioned whether the Government will act if other payments are revealed.
"These people have acted in breach of their duties," Mr Adams said.
"They've caused huge losses, brought banks to the point of collapse, almost bankrupted the state, they should not be rewarded."