Business Irish

Tuesday 20 August 2019

New Central Bank Governor faces no confidence vote after his first day

New Central Bank Governor Philip Lane
New Central Bank Governor Philip Lane
The Central Bank has denied it is paying bonuses
Charlie Weston

Charlie Weston

Staff in the Central Bank will vote on a motion of no confidence in the management at the regulatory authority.

The row erupted on new Governor Philip Lane's first day in the office.

The Unite union accused the Central Bank's senior management of "apparent duplicity" over what it says are revelations of a second bonus scheme.

The Central Bank has denied it is paying bonuses, insisting instead that there are two retention payment schemes used to make sure key staff stay working for it.

A new retention payment scheme was set up in 2014 after one that had been in place since 2011 proved ineffective.

But Unite regional officer Colm Quinlan said its members were to vote on a no-confidence motion after what he said was an admission by the Bank of a "second secret bonus scheme".

He was responding after the Central Bank issued a statement on Wednesday night saying it put in place a retention policy in 2014, which amounted to extra payments of up to 21pc of salaries. It said this cost €234,000, and was paid to 29 staff.

The Central Bank insisted the payments were in line with Government public sector pay cuts.

This was on top of an admission last week of €500,000 spent on a separate 2011 retention payment scheme.

Mr Quinlan said: "Although it was only last week that the issue of so-called retention payments entered the public domain, Unite has been raising concerns about a bonus culture at the Central Bank since last May.

"At that time, we not only expressed our disquiet regarding the retention bonuses - we also specifically asked whether there were any other bonus schemes in place, and we were categorically assured that there were not.

"We were, therefore, extremely disturbed to discover that, while Unite members at the Bank were holding their AGM, the Bank issued a press statement confirming that - contrary to previous denials - another bonus scheme has in fact been in operation since 2011."

He added: "The Bank's earlier denial of this scheme's existence, and their decision to belatedly issue a press statement admitting its existence while our members were meeting, constitute apparent duplicity."


He claimed the disclosures of a second extra payment scheme indicate a level of disrespect for the staff, and for the general public which relies on the Central Bank to lead the way in terms of probity.

"It is particularly worrying that the Bank apparently sought legal advice regarding the legality of the 2014 retention bonus scheme, despite have operated a similar scheme since 2011 - effectively seeking post-facto legal justification for a decision that had already been taken and implemented," Mr Quinlan said.

The Central Bank last night issued a statement calling on Unite to "return to agreed procedures".

However Unite argues that the special payments breach emergency laws cutting pay and banning bonuses in the public sector.

Those getting the bonuses have to sign a contract promising to keep "the fact and the amount of the payment confidential", the union said, quoting from a copy of staff contracts it obtained.

The Central Bank said the payments amount to 21pc of the €67,000 to €84,000 salaries they are paid. It said the "vast majority" of those covered by retention agreements are in the professional and administrative grades.

It said it is satisfied that payments comply with legislation.

Meanwhile, Prof Lane issued a YouTube video to employees on his first day at his desk.

He said that he would be a regular user of blogs and video messages for communicating with staff.

Irish Independent

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