Slashing semi-state chiefs' pay will hit newcomers but spare incumbents
THE Government is to radically slash the pay of semi-state chief executives and judges, but is likely to stop short of hitting those currently holding such top jobs.
Politicians' pay and pensions will also be cut radically under plans being finalised this weekend. However, the Government may not be able, or willing, to amend the contracts of existing semi-state chiefs like Padraig McManus, the ESB boss who earned more than €750,000 last year.
The pay for Mr McManus, like many other semi-state bosses, is set according to an individual contract, and his current arrangements last until July 2012.
It is understood that it would be difficult for the Government or the ESB itself to change the terms of this contract.
However, the Government could ask semi-state CEOs to take a further voluntary pay cut. For example, Mr McManus took a 10pc voluntary pay cut in April 2009.
The judiciary can also not have a pay cut imposed upon them due to issues of judicial independence, but the option of calling on members to reduce their pay in the national interest is always open to the Government, as their ultimate employer.
Reports suggest that the Government will introduce a ceiling of just over €200,000 on the salaries of chief executives . But, crucially, this will be aimed at incoming chief executives and judges.
If this measure is adopted by the Dail, it would mean huge cuts for whoever runs the main semi- states in future. For example, the chief executive of Bord Gais (currently John Mullins) is paid €394,000, while the chief executive of Coillte (currently David Gunning) is paid €417,000. These payments include pension payments and other non-pay benefits.