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Ministers powerless to cut semi-state wages

THE Government is powerless to force cuts in the wages of semi-state workers, despite describing some of their salaries as "shocking".

A new pay review has been set up to discover if semi-state employees -- and their bosses, who earn up to €750,000 a year -- are being paid far more than comparable workers.

But the review will not lead to any reductions in the pay packets of highly paid semi-state bosses such as ESB chief executive Padraig McManus, who earns €750,000; or Dublin Airport Authority chief executive Declan Collier, who gets €568,000.

The Department of Finance confirmed last night it did not have the power to force a cut in the wages of top executives, which were part of their contracts of employment.

And it could not direct semi-state companies to reduce the wages of their workers either, because this was a matter for the companies themselves.

The fresh focus on high pay rates in companies part-owned by the taxpayer came after the publication of the state assets report, headed by economist Colm McCarthy.

His 179-page report showed that 10 semi-state bosses were receiving pay and pension packages worth a total of €4.4m. And senior executives at state companies were paid bonuses in 2009 and 2010 despite a request from the Government to suspend all extra payments.

Fresh details of the bonuses emerged last night, including how port bosses were paid thousands of euro last year when the public finances were in freefall and some of the ports were losing money.

But some semi-states, including the DAA, Bord Gais, Bord na Mona and Coillte, are still refusing to say if bonuses will be paid for 2010.


The McCarthy review called for wages in semi-state companies to be compared with those of other workers at home and in Britain to check that the costs were competitive. It also recommended breaking up or selling off a raft of the semi-state companies in a plan to raise €5bn.

But the Government insists there will not be a firesale of semi-states.

The McCarthy review also provided details of the average wages for rank-and-file workers in semi-state companies. It said the 672 workers in the Irish Aviation Authority were paid an average of €95,000 each.

The average pay in Eirgrid is €83,000, while ESB workers get €75,500 and Bord Gais and Dublin Port workers get an average of €67,000 each.

However, the average pay is lower in CIE (€49,000) and in companies such as Bord na Mona (€44,800), An Post (€43,300) and Coillte (€45,600).

The review group chaired by Mr McCarthy noted that even though a number of semi-state companies had scaled back pay packages over the past two years, the effect had been offset by hikes elsewhere.

"In some cases, a reduction in the basic salary has been more than compensated for by an increase in other elements of the overall remuneration package," the report said.

Irish Independent

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